The Exchange Traded Funds (ETFs) in Egypt could be open for business before the end of the current month, stock exchange vice chairman Khaled El-Nashar said on Monday.
Through the ETFs, Egypt is looking forward to increasing liquidity and attracting new investors onto the local market.
Khaled El-Nashar – Vice Chairman of the Egyptian Exchange (EGX) – said in an interview with Amwal Al Ghad the bourse’s Advisory Committee has recently discussed with the market regulator, the Egyptian Financial Supervisory Authority (EFSA) the recent developments in the ETFs file including the new mechanisms to enable investors to invest in the ETFs.
The ETFs file is due to be submitted for endorsement within the EFSA’s upcoming board meeting ahead of being released in the market, he noted.
Exchange traded funds serve as open investment funds which follow the movement of specific indicators, listing and trading their supplementary documents on the stock market as shares and bonds. They allow investors to gain a broad exposure to entire stock markets of different countries and specific sectors with relative ease, on a real-time basis and at a lower cost than many other forms of investing.
In coordination with the EGX and Egypt’s Central Clearing, Depository and Registry house (MCDR), EFSA had completed the new mechanisms for the ETFs.
Egypt’s stock exchange has been suffering from low rates of liquidity since the worldwide economic recession of 2008, the effects of which were exacerbated after the outbreak of the 25 January Revolution.