ID :
24843
Thu, 10/16/2008 - 15:06
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https://oananews.org//node/24843
The shortlink copeid
ADX may curb 'hot money'
Abu Dhabi, Oct 16, 2008 (WAM) - The Abu Dhabi Securities Exchange (ADX) may act to curb foreign "hot money" - the short term stock market plays - if it causes market instability, the bourse's deputy chief executive said yesterday according to a “Reuters” report.
"We as a market have been able to attract foreign investment, which is needed because we are trying to encourage liquidity," Rashid Al Baloushi told reporters. "But if we have a problem with hot money from outside, we will fix it."
Foreign holdings in ADX amount to about 10 per cent but foreigners account for about 30 per cent of total trading. "It means it is hot money, not long-term and can leave any time which is bad for market stability,"
Ziad Al Dabbas, advisor for Capital Markets at National Bank of Abu Dhabi told a brokerages forum. "In markets such as Abu Dhabi and Dubai, although foreign holdings are low, they account for high trading volumes, which is dangerous," he said.
Dabbas said the regulator can act by bringing down the minimum percentage of holdings for foreigners. "But, at the same time, this is an open market and foreign investments are needed," he added.
"We as a market have been able to attract foreign investment, which is needed because we are trying to encourage liquidity," Rashid Al Baloushi told reporters. "But if we have a problem with hot money from outside, we will fix it."
Foreign holdings in ADX amount to about 10 per cent but foreigners account for about 30 per cent of total trading. "It means it is hot money, not long-term and can leave any time which is bad for market stability,"
Ziad Al Dabbas, advisor for Capital Markets at National Bank of Abu Dhabi told a brokerages forum. "In markets such as Abu Dhabi and Dubai, although foreign holdings are low, they account for high trading volumes, which is dangerous," he said.
Dabbas said the regulator can act by bringing down the minimum percentage of holdings for foreigners. "But, at the same time, this is an open market and foreign investments are needed," he added.
