The UAE stock market is a part of its strong financial markets that help ensure that helps to expand the economy and investment potential of the country. There are two main drivers of these markets in the UAE: this is the Dubai Financial Market (DFM) and the Abu Dhabi Securities Exchange (ADX). If you are in the UAE, these exchanges help individuals, businesses, and institutions to invest in the rapidly growing economy of the country.
What is the Dubai Financial Market (DFM)?
A major driver of the UAE stock market is the Dubai Financial Market (DFM). The DFM is one of the major stock exchanges that he UAE have. Located in the famous city of Dubai, DFM was established in back in 2000. The DFM is a profitable marketplace that is heavy regulated by transparent agencies and has a strong potential for investments. In the DFM, any investor can easily trade in stocks, bonds, and other securities on the exchange. The DFM is a key driver that aims to make Dubai’s a global business centre as it currently supports all types of local and international investors who contribute to the growing economy of the city.
Some important features of the DFM as a UAE stock market
- If you are looking to invest in the DFM, then you should be willing to comply to the principles of Islamic finance. In this case, you will not be allowed to earn any interest. Also, you will not invest in any businesses that has to do with alcohol, gambling, and other activities that many not comply to the principles of sharia.
- With the DFM as a UAE stock market, it means that you as an investor have the freedom to trade in a variety of financial tools on the DFM. This means that you are free to trade in stocks, bonds, ETFs, and Sukuk also known as Islamic bonds). This gives you as investor the diversity to easily build and expand your portfolio.
- If you invest in the DFM, you will be able to access various profitable companies from a diverse market segment. Investors can easily access key sectors such as real estate, banking, telecommunications, and transportation.
What is the Abu Dhabi Securities Exchange (ADX)?
The Abu Dhabi Securities Exchange (ADX) is also a major player in the UAE stock market. It was created back in 2000 and acts as the official stock exchange for Abu Dhabi, which is the capital of the UAE. ADX works in the same way as the DFM, as it also makes it easy for various investors to be able to access a range of securities such as stocks, bonds, and ETFs.
Some important features of the ADX as a UAE stock market
- The ADX is a core UAE stock market that is known for its large market capitalization, which is driven mainly by banks and other businesses that are owned by the government. There are many major banks and companies that are listed on the ADX.
- If you are investing in the ADX, you will be able to access a diverse collection of several key sectors, which includes banking, energy, telecommunications, and real estate. They help investors to easily access numerous investment opportunities across various industries that are key drivers of growth in the economy of Abu Dhabi.
- If you are a foreign investor looking to invest in the ADX, you can easily trade in key sectors. This is because the UAE stock market continues to make itself available and accessible for foreign investors. This is because the UAE is always on the lookout for ways to attract international investments in order for it to become a global financial hub.
How is the DFM different from the ADX as a UAE stock market?
In terms of the UAE stock market, you can easily trade various securities on the DFM and ADX as reliable platforms. However, both platforms come with some key differences. These include:
- The first major difference between both UAE stock market platforms is in their locations. The DFM is based in Dubai, while the ADX is in Abu Dhabi. This means that each stock market serve as a good platform for investors to access profitable businesses in that geographic location and reflects the economic potentials in their respective regions as well.
- Secondly, the DFM tends to focus on certain companies which can be found within the UAE real estate and tourism sectors. While the ADX tends to focus more on businesses that are based in the UAE banking and energy sectors.
