3. Five years out, do you see Dubai becoming a global business hub much like London, New York or Tokyo? Are there any other competing cities in the Middle East?
The business environment and opportunity is projected to keep growing in the Middle East and especially in Dubai. There are various Forex laws that regulate how firms can operate in their respective jurisdiction. One such jurisdiction and free zone is the Dubai International Financial Centre (DIFC) and others like the DGCX. Each jurisdiction is different and many laws are new and will mature with time. I see Kuwait as a potential hub because they allow and regulate Forex through the central bank. Lebanon has similar laws but geopolitically it is unstable. Saudi Arabia is implementing change, and we see great potential in King Abdullah Economical City.
The whole Middle East is changing and there is a demand to supply the market with products as do other financial hubs worldwide. But when it comes to market leaders the UAE and in particular Dubai are leading the way in terms of market advancement. Dubai is and is posed to be the regional finance hub for the foreseeable future.
With that said, people in the Middle East still prefer and trust the UK and US regulatory environment. WorldWideMarkets originally operated with a Netherlands and BVI license, however, our clients insisted on WWM operating under the regulatory approval of the FCA in the UK. We listened to our clients and received FCA approval in February 2014.
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4-Where do you see the retail FX market in the Arab World in the near and long-term?
I’m optimistic by nature and I see all evidence pointing to an industry that is and will experience tremendous interest and growth in the coming years. In the short and medium-term we can expect to see client interest go up and down with all markets. This will normally happen due to country specific factors, stock market conditions and the overall health of the global economy.
The most important factor to consider is investor education. As investors become more sophisticated they learn that Forex as an asset class has numerous diversification benefits. Education and trading experience positively affect Forex as a reputable and alternative asset class. We have veteran traders that have been with us for years. New market participants are also coming to learn about Forex as an asset class every day. As with any other asset class for investment we have periods of low volatility that affect short-term interest in trading.
Equity trading and equity index multiples are currently at all-time highs. A lot of investors are making (and loosing) money in the equity markets. Equity markets in the Middle East generally have higher volatility than equity markets in North America and Europe. When the local and global stock markets have their correction, I think we will see greater diversification into Forex as a percentage of portfolio assets.