Abu Dhabi Securities Exchange (ADX) launches Covered Short Selling and amends the Securities Lending and Borrowing Guidelines

Abu Dhabi Securities Exchange (ADX) launches Covered Short Selling and amends the Securities Lending and Borrowing Guidelines

Abu Dhabi Securities Exchange (ADX) launches Covered Short Selling and amends the Securities Lending and Borrowing Guidelines

Abu Dhabi Securities Exchange (ADX) today announced the launch of its latest investment service “Covered Short Selling”, to support the exchange's strategy of diversifying investment and providing investors with a broader range of hedging mechanisms. By doing so, it will attract a new segment of specialized and experienced investors, driving both liquidity and trading volumes.

The launch of CSS comes after the Securities and Commodities Authority (SCA) approved ADX's covered short selling guidelines, which enable investors to sell borrowed securities or financial securities pledged for return to lenders.

Covered short selling involves investors selling shares in a specific company that they do not own at the time, but which they believe to be over-valued, which creates