MSCI Tadawul 30 Index launched

MSCI and the Saudi Stock Exchange (Tadawul) announced the launch of the MSCI Tadawul 30 Index (MT30), a tradeable index, according to a bourse filing.

The Index is based on the MSCI Saudi Arabia IMI Index that represents the performance of large, mid and small-cap stocks of the Saudi Arabia equity market.

The Index targets the top 30 securities of the MSCI Saudi Arabia IMI Index based on free float market capitalization with capping criteria and is designed to be able to serve as the basis for financial products including derivatives and ETFs.

The index will be rebalanced four times every year, allowing number of constituents to range between 25 and 35. The maximum security weight is capped at 15 percent.

Plans for the tradeable index were announced by MSCI and Tadawul in September 2018, as MSCI announced the classification of Saudi Arabia to an Emerging Market status in its annual global market classification review in June 2018.

Saudi Arabia will enter the MSCI Emerging Markets Index in two phases in 2019, with the first phase set to coincide with MSCI’s May 2019 Semi-Annual Index Review in June.

“The MSCI Tadawul 30 Index (MT30) has been designed with tradability, investability and capping criteria to be able to serve as the basis for index futures and other financial products including derivatives and exchange-traded products,” Robert Ansari, head of Middle East at MSCI, said.

“Today’s launch of the MSCI Tadawul 30 Index (MT30) is a significant step forward in creating Saudi Arabia’s derivatives market, in line with Vision 2030 Financial Sector Development Program,” Khalid Al Hussan, CEO of Tadawul, added.