What is The Stock Exchange in Saudi Arabia
What is the stock exchange in Saudi Arabia The stock market is defined as a place where buyers and sellers gather. It is not a physical location or a separate entity, but a branch of the stock market. Where economic transactions such as buying and selling shares, for example, are carried out through various stock exchanges. The platform sells shares of private companies to investors, or company property documents and negotiable and transferable bonds.
Shares are considered part of the capital of a particular company, which returns profits to its owners as one of the owners of the company and has rights. There are markets for trading shares in all countries of the world, such as the Saudi stock market.
History of the stock exchange in Saudi Arabia
The Kingdom of Saudi Arabia is one of the countries that enjoys economic strength because of its oil market, and as an important member of OPEC.
The Saudi National Petroleum Corporation (Aramco) produces and manages billions of barrels of Saudi oil.
Tadawul is the main and only stock exchange in the Kingdom of Saudi Arabia, and the main exchange between the countries of the Gulf Cooperation Council.
In the 1970s, the Saudi stock market was unofficial and consisted of only 14 companies, but in 1984, the Saudi government established a ministerial committee to develop and regulate the Saudi market.
Stock exchange in the Kingdom of Saudi Arabia
In 2007, the Saudi Stock Exchange Company (Tadawul) was established to provide trading in Islamic stocks and bonds, which are called sukuk.
There are currently nearly 200 companies listed for trading, and every new company offers shares for subscription, which is the process of buying shares.
So that individuals become part of the company’s capital, and then provide more shares to increase the company’s capital and expand the company’s activities.
The Tadawul Index is the main Saudi stock market index that tracks the performance of all companies listed on the Saudi stock market.
Mostly, we find that the Saudi stock market is positively and closely linked to the US stock market due to its correlation with the US dollar.
The stock exchange in Saudi Arabia is also closely linked to neighboring stock exchanges such as the Abu Dhabi Stock Exchange, the Dubai Stock Exchange, and the Bahrain Stock Exchange.
Shareholding companies in the Saudi Stock Exchange
Among the most important companies contributing to the Saudi stock market are SABIC, Sipchem, SAFCO, SADAFCO, and the Saudi Electricity Company.
There is also Zain Telecom Company, Al-Rajhi Takaful, and many other famous Saudi companies.
The Saudi stock market is considered one of the most liquid markets in the Arab world, and there are many brokers that provide large amounts of data on all financial markets.
The Saudi stock market includes indices for major industries, leading stocks, and gainers and losers.
The main stock index for the Saudi stock market is the Saudi Stock Exchange Index (TASi), which is a capital market
Broad includes all stocks listed on the stock exchange.
It also provides listing services for stocks, real estate investment funds, and stock exchange trading investments. It also provides services for trading bonds and Islamic products, Islamic bonds, which have the same financial certificates as bonds designed to comply with Islamic law.
The broker must accept deposits in Saudi riyals and be subject to the supervision of the Saudi Arabian Monetary Agency to maintain its local reputation in the Central Bank of Saudi Arabia.
The stock trading system in the Saudi Stock Exchange uses the X-Stream INET trading system, which comes from the Nasdaq Stock Exchange for trading.
The use of this system dates back to 2015. The securities listed in the Saudi Stock Exchange are first traded according to price requirements, and then orders are entered by the broker on behalf of the client.
The companies that trade in Saudi stocks always differ in the fees and commissions that take place on the buying and selling of Saudi stocks.