Post on 22-Dec-2015
Amman Stock ExchangeAmman Stock Exchange
Jalil Tarif
Chief Executive Officer
Dead Sea - Jordan
October 2007
AMEDA Meeting
Amman Stock Exchange
History of Capital Market
1930s Trading in Securities started informally.
1976 Amman Financial Market (AFM) was established.
1978 AFM started operations.
1997 Capital Market Reforms introduced, Securities Law issued.
1997 Jordan Securities Commission (JSC) was established.
1999 Amman Stock Exchange (ASE) was established.
1999 Securities Depository Center (SDC) was established
2002 New Securities Law Issued.
Capital Market in Jordan
Financial Brokerage
Financial Services Companies
Securities Depository Center (1999)
Jordan Securities Commission (1997)
Amman Stock Exchange (1999)
Mutual Funds
Public Shareholding Companies
Custodian
Management of Primary Issues
Financial Advisory
Investment Management
Investment Trusteeship
Certified Financial Professionals
Amman Stock Exchange
Amman Stock Exchange (ASE)
Established in March 1999
Independent legal entity
Managed by private sector
Membership of brokers
Non for-profit
Amman Stock Exchange
Securities Listing Requirements
First Market
Financial Position Requirements:
Profitability
Dividends ( Cash or Stock)
Liquidity Requirements:
Free Float
Turnover
Trading Days
Number of shareholders
Financial Reporting:
Annual Report
Semi Annual Report
Quarterly Report
Second Market
Right to Commence Operations
Financial Reporting:
Annual Report
Semi Annual Report
Continuous Listing Requirements
BondsGovernment and Corporate Bonds are eligible for listing
Amman Stock Exchange
Trading System Overview
Production Servers
UNIX BOXHigh Availability ClusterPowerful Dual Processor
HostsMain DatabaseTrading System
UsersTrading FloorSurveillance
TV Channels
Data Vendors
Information Dissemination
Websites
CONNECTIONFiber OpticsLeased Lines
FACILITIESRemote TradingRemote InquiryIntranet
Backup Trading Floor Surveillance
Mobile Phones
Remote Brokers
(NSC) (GL)
Information DisplayScreens
Market Monitors
Amman Stock Exchange
Information Dissemination
ASE disseminates clear, accurate, sufficient and timely
information and data on securities trading.
ASE discloses information on issuers, members, and material
information. Public may have access to these material.
Data disseminated through GL stations, data vendors, market
watch, ASE website, and TV stations.
Times of transactions information posted at the ASE site.
Post trade data sent to brokers through Domino.
ASE Market Capitalization & Trading Value
0
5000
10000
15000
20000
25000
30000
35000
40000
2000 2001 2002 2003 2004 2005 2006 2007*
Market Cap
Trading Value
(US
$ m
illi
on)
* End of September
Amman Stock Exchange
Average Daily No. of Transactions
812
564
638
547
1226
1801
3262
4789
9805
13580
14224
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007*
* End of September
Amman Stock Exchange
ASE Performance
-60
-40
-20
0
20
40
60
80
100
120
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007*
ASE General Weighted Index Emerging Market Composite Index
(%)
* End of September
Amman Stock Exchange
Primary Market(U
S$
mil
lion
)
(Point)
* End of September
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
1999 2000 2001 2002 2003 2004 2005 2006 2007*
1000
2000
3000
4000
5000
6000
7000
8000
9000
Primary Issues ASE General Index
Amman Stock Exchange
Market Velocity
0
10
20
30
40
50
60
70
80
2000 2001 2002 2003 2004 2005 2006 2007*
(%)
* End of September
Amman Stock Exchange
The Market P/E Ratio
0
10
20
30
40
50
2001 2002 2003 2004 2005 2006 2007*
Historical Average = 17
(Tim
es)
* End of September
Amman Stock Exchange
Non-Jordanian Ownership, September 2007
36
38
40
42
44
46
48
2001 2002 2003 2004 2005 2006 2007
(%)
Amman Stock Exchange
Recent Study by IMF
Investors may be able to achieve additional
diversification by investing in the ASE
On a risk-adjusted basis (Sharp Ratio),the ASE
outperformed most markets.
ASE compares favorably with many other regional
markets in terms of investment climate.
Low price volatility.
Permissible Equity Markets Investment Analysis, CalPERS
Country Macro-Factors
Political Stability
Transparency
Productive Labor Practices
Market Macro-Factors
Market Liquidity and Volatility
Transparency
Market Regulation/Legal System/Investor
Protection
Capital Market Openness
Settlement Proficiency/ Transaction Costs
Poland
Israel
South Korea
Chile
Czech Republic
South Africa
Taiwan
Hungary
Mexico
Malaysia
Brazil
Jordan
India
Thailand
Turkey
Peru
Argentina
Philippines
Colombia
China
Morocco
Sri Lanka
Venezuela
Indonesia
Russia
Egypt
Pakistan
Amman Stock Exchange
Future Plans
Jordan National Financial Center Project
Upgrading the trading system
Internet trading.
Demutualization
New ASE Dow Jones Index
Amman Stock Exchange
Jordan National Financial Center Project
The Center will contain:
ASE
SDC
Financial Studies Center
Brokers’ Offices
Investors Gallery
Other facilities
The Center total area 85758 m2 .(Buildings area 51766 m2)
Total cost US$ 100 million
Expected completion date November 2009
Amman Stock Exchange
Project’s Site
Amman Stock Exchange
Project’s Concept
The external design of the building is inspired from the Siqq of Petra which is considered an ancient symbol in Jordan’s history.
Amman Stock Exchange
Jordan National Financial Center Project
Amman Stock Exchange
Upgrading the Trading System
A contract was signed with AtosEuronext Market Solutions and GL Trade for Euro 2.5 million.
New trading system V900.
Fully Linux environment.
System applied in major stock exchanges.
Better flexibility to implement market rules.
Highly improve system capacity and lower latency.
The new system will be up and running by May 2008.
Amman Stock Exchange
Demutualization
The new Securities Law for 2002 authorized setting up other stock exchanges
The ASE may be restructured by a decision of the Board of Commissioners of the JSC, upon approval of the Council of Ministers.
Negotiations are taking place with alliances to support demutualization process.
The ASE shall become shareholding company totally owned by the Government as a first step.
The Government then shall sell a share to financial institutions, brokerage firms, international institutions and other parties.
Amman Stock Exchange
New ASE Dow Jones Index.
An agreement with Dow Jones was signed in late 2006
Dow Jones will calculate a new composite index, named “The Amman Stock Exchange and Dow Jones”.
The new index will be weighted by market capitalization of free float shares.
The index can be used as a base tool in forming financial derivatives and ETFs.
The index will be launched in late 2007.
Amman Stock Exchange
Other Projects
Internet Trading.
Joining the WFE.
Codes of Corporate Governance
Introducing new instruments.
Marketing strategy.
Amman Stock Exchange
International Exposure
Amman Stock Exchange
Investment Opportunities
No taxes on cash dividends
No capital gains tax
Free repatriation of investment and income
No ceiling on foreign equity ownership
Political StabilityPolitical Stability
Economic Openness and Free Trade
Economic Openness and Free Trade
Privatization