The Dubai International Financial Exchange is preparing to list a range of Islamic structured products that will offer investors Shariah-compliant opportunities on the exchange's new TraX platform, created in August as the region's first structured products platform.
'The structured products market is growing rapidly around the world, and the DIFX is at the forefront of expansion in its region,' says the exchange's chief executive Per Larsson. 'We look forward to listing Islamic products that track regional and international equity indices and other well known benchmarks.'
Like conventional structured products, Islamic products can be tailored to suit a range of investment styles. Some are capital-protected while others offer greater risks and/or rewards.
'Expanding the TraX platform to include Shariah-compliant structured products is a key initiative by the exchange,' says DIFX executive officer Hamed Ali. 'We are already the largest exchange in the world for Sukuk by listed value, at USD13.78bn, and we intend to remain at the forefront of innovation in the Islamic finance sector to support its growth.'
TraX currently lists 23 structured products issued by Deutsche Bank, Merrill Lynch and Morgan Stanley. All three as well as Citigroup say they plan to list Islamic products in the near future.
'All TraX securities can be easily traded, just like shares, through local and international brokers linked to the DIFX,' says Armen Papazian, the exchange's managing director responsible for innovation and development. 'TraX products allow for better risk management and provide the regional investor with valuable portfolio diversification tools.'