Israel Securities Authority Approves CFD Trading on TA-35 Index

The decision could lead to higher trading volume for the Tel Aviv Stock Exchange.

The Israel Securities Authority (ISA) has announced that it has officially approved the launch of CFD trading on one of its leading indexes, TA-35.

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As previously reported by Finance Magnates, the ISA has been among the most stringent regulatory authorities in the world. The fact that the regulator has approved the application of CFDs to the Israeli stock index is a positive development, which has the potential to benefit all parties involved.

The general public will receive another access point to the market, rather than having to trade through banks directly. Meanwhile, CFD providers in Israel will gain higher commissions as a result of increased trade volumes.

Finally, the overall scope of Israel’s stock market will likely be boosted by the higher trading volume as well, which remains thin in a small market that has hindered alternative investment methods over the past couple of years.

Tzah Druker, Head of the Israeli Trading Arena Association, told the Israeli business daily Globes: “We believe that trading arenas (CFD providers) are expected to raise the trading volumes in the Tel Aviv Stock Exchange by tens of percentage points, once they become operational (translated quote).”

TA-35 is a stock market index, which includes the 35 largest firms listed on the TA-125 index. Previously known as the TA-25, the index was expanded to 35 companies in February of last year.

ISA Relatively Stringent

With regards to the FX and CFD industries, the ISA’s demands for obtaining a license were highly rigorous, leading to a wide spread exit from the Israeli market. As it stands, only 6 companies currently hold a license to offer FX and CFD services to Israeli citizens.

The ISA has stringent rules by comparison to other global regulatory authorities. Israel’s regulator has already issued a complete ban of the binary options industry. The ban not only makes it illegal to offer binary options services to citizens of Israel, but also to engage in any activity associated with the industry in any capacity, even to countries that permit trading on binary options.

 

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