S&P Indices announced on Monday that it has partnered with the Arab Federation of Exchanges to launch an index of 40 companies based in the Middle East. The S&P AFE 40 includes companies from Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Palestine, Qatar, Saudi Arabia, Tunisia and the United Arab Emirates.
“We are seeing a growing interest among investors in Arab equities as this market begins to mature,” Robert Shakotko, managing director at S&P Indices, said in a statement. “The Arab Spring and the liberalisation of Arab countries seem to signal a new era of investment opportunities in the Arab world.”
To be counted among the 40 largest stocks measured by float-adjusted market capitalization, each stock must have at least US$50 million traded over 12 months. Each country can have no more than 10 stocks, and there must be at least one stock from each country.
The index caps countries’ weight at 35%. Saudi Arabia has a 35.1% index weight with 10 companies listed, followed by Kuwait with 23.3% and Qatar with 12.2%.