In May, the Tadawul, the Saudi stock exchange, opens to foreign investors for the first time. The list of rules and conditions is longer than an oil well standpipe – only firms with assets greater than US$ 5B can invest, they are not allowed to own more than 5 percent of any company, construction firms in the Holy Cities of Mecca and Medina (as earlier mentioned in the Fringe, the world’s priciest real estate) are off-limits, etc.
Some fund managers believe that it will ultimately pay to get in now, though. An analyst at emerging markets investment titan Ashmore Investment Management has opined that volumes will pick up dramatically in 2017, when MSCI adds Saudi Arabia to its benchmark emerging markets index. The Tadawul is one of the largest exchanges, by market capitalization, across all emerging markets; it will likely comprise at least 3-4 percent of total index weight upon inclusion. Institutional fund managers will then need to acquire comparable stakes in listed Saudi companies in order to track the index.