Lxyor, FTSE, Coast launch first Gulf ETF
Institutional investors will have greater access and liquidity in the Gulf's second largest stock market after Lyxor, FTSE Indices and Coast Investment & Development Company launched the region's first exchange traded fund.
The Lyxor ETF FTSE Coast Kuwait 40, listed in London, tracks the performance of the 40 most liquid stocks trading on the Kuwait Stock Exchange. It has been designed for the creation of derivatives, index tracking funds, ETFs and performance benchmarks.
The index constituents are ranked by investable market capitalisation and by liquidity, and account for around 65% of the total market cap of the KSE.
The KSE has been one of the strongest and most stable stock markets in the Middle East. Bar a sharp drop in 2006, it has recorded a 600% rise since 2000, and fundamental and economic indicators suggest strong potential for further growth. Kuwait is ranked the world's sixth richest country with a GDP per capita of $65,000. It has the fifth largest oil reserves in the world and is undertaking a $200 billion infrastructure programme to support growth and diversification of the economy.
The FTSE Coast Kuwait 40 index was the result of a collaboration two years ago between Coast and FTSE indices. Coast (profiled in the July/August 2008 issue of Global Investor magazine) engages in a variety of investment management activities in the region, including private equity, asset management and real estate.