The market liquidity of ADX jumped five-fold in 2021 amid an IPO boom. Traded values (buy + sell) on the exchange increased 407 percent from AED145 billion ($39.51 billion) in 2020 to AED739 billion ($201 billion) in 2021, driven by higher levels of domestic and international investment.
Local investors accounted for 70 percent of the exchange’s traded value, while foreign institutional investors accounted for 30 percent.
Meanwhile, net foreign investment on the exchange reached AED15 billion in 2021, the highest level ever on the exchange. The market value of shares owned by foreign investors in 2021 doubled from AED78 billion to AED156 billion, while those held by UAE nationals reached AED1.5 trillion compared to AED685 billion in 2021, an increase of 117 percent.
At the same time, the number of new investors who registered on the exchange in 2021 increased by 701 percent from 2,362 in 2020 to 18938 in 2021. The number of new institutional investors increased 77 percent to 708 in 2021 versus 400 in 2020.
The increased demand for Abu Dhabi stocks helped drive the exchange’s benchmark index 64 percent higher. Meanwhile, the market capitalization of stocks listed on the ADX more than doubled to a record AED1.6 trillion.
ADX One strategy
The ‘ADX One’ strategy, announced at the start of 2021, launched 22 initiatives to bolster corporate governance and meet the evolving needs of global issuers and investors.
As part of the strategy, the ADX introduced a derivatives market in the fourth quarter, which paved the way for an agreement with FTSE Russell to develop co-branded indices, including a tradable FTSE ADX Blue Chip Index that will be launched in 2022.
The exchange has also established a framework for listing Special Purpose Acquisition Companies (SPACs) on ADX, which was approved by the Securities and Commodities Authority (SCA) in January.
Furthermore, as part of the ‘ADX One’ strategy, the exchange forged several partnerships with global stock markets in 2021, sealing agreements with Bahrain Bourse, Bursa Istanbul, and Astana International Exchange to unlock direct market opportunities and enhance cooperation through information exchange.
In 2021, the ADX welcomed nine companies to the exchange, including ADNOC Drilling, the biggest IPO in the exchange’s history, Alpha Dhabi, the real estate and construction company owned by International Holding Company (IHC), and Yahsat, the satellite operator owned by Mubadala Investment Company, and Fertiglobe.
Six debt instruments and an Exchange Traded Fund (ETF) were also added on the exchange in 2021, bringing the number of publicly listed companies to 69, debt instruments to 27, private companies to 13, and ETFs to two.