ADX lists Exchange-Traded Fund tracking Shariah-compliant products

Abu Dhabi Securities Exchange, ADX, on Monday announced that Chimera Capital LLC’s Exchange Traded Fund, ETF, has listed on the Exchange. The ETF has been designed to replicate the S&P UAE Domestic Shariah Liquid 35/20 Capped Index.

The index is provided by S&P and tracks the performance of UAE-based Shariah compliant liquid equities, opening up a new and increasingly demanded asset class to investors seeking exposure to the UAE’s economy, an ADX statement said on Monday.

Chimera S&P UAE Shariah ETF currently has two share classes, including an accumulating Class A listed on the ADX, which reinvests income back into the fund at no additional expense, and a distributing Class B listed on the Dubai Financial Market, DFM, that distributes to investors any collected dividends.

The ETF’s dual share class option provides investors with the added flexibility to choose between regular portfolio returns or maximizing future investment.

Commenting on the announcement, Khaleefa Al Mansouri, Chief Executive of the ADX, said, “ADX once again congratulates Chimera Capital LLC for developing this product, the first exchange-traded fund tracking S&P Shariah-compliant products in the UAE. With a primary listing on ADX, it is a new opportunity for Islamic investors to add variety to their portfolios and manage risk more effectively.

In turn, the Chairman of Chimera Capital LLC said that the Chimera S&P UAE Shariah ETF will allow investors to capitalise on the prospects of the UAE’s economy.

The Index is structured and built by S&P and monitored by a Shariah Board that meets regularly to review and rebalance the index quarterly to guarantee that the securities in the index are both liquid and Shariah compliant. Currently the index has ten securities across the UAE markets, allowing investors a single access point to a balanced portfolio of Shariah compliant liquid UAE securities as per S&P Shariah Board guidelines.

Al Mansouri concluded, “Abu Dhabi is becoming increasingly successful in attracting a more diverse range of investment firms and investor profiles, supported by the exchange’s growing liquidity, customer focus, increasing foreign ownership limits and robust and transparent regulations. ADX is further maintaining its competitiveness by digitally led investment in its systems and infrastructure to develop a world class capital market, such an important component of Abu Dhabi’s economy.”