Egypt will start trading the Exchange traded funds (ETFs) within the second week of January 2015, bourse’s chairman Mohamed Omran announced.
The ETFs will offer investors the opportunity to cover markets in different countries or sectors at costs lower than other investments.
Mohamed Omran – Chairman of Egyptian Exchange (EGX) – said ETFs would be listed within a week, and trading will start early next year.
Beltone Financial was the first company to obtain the license for ETFs and market maker activity, and is launching a fund called XT-Misr that mirrors the performance of the country’s EGX 30 stock index.
In March, Egypt’s financial market regulator released the rules to facilitate the creation of index and real estate funds as well as amendments to margin trading rules in an attempt to increase liquidity in the market and draw more local and foreign investors.
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.