Abu Dhabi broker eyes share of FX, commodity trading

DUBAI: ADS Securities, a new Abu Dhabi-based brokerage is eyeing a share of the rapidly growing trade in commodities and foreign exchange by bridging the time gap between Asian and European markets, its top executive said.

The firm, backed by private investors and capitalised at $400 million, is aiming to take advantage of the local time zone with its presence in Abu Dhabi and its proximity to large sovereign wealth funds and institutions in the oil-rich region.

"When you look at where we are situated, we are open here and there is no body to serve (investors). That's where the opportunity is and hence the decision to operate out of Abu Dhabi," Mahmood Ebraheem Al Mahmood, ADS's chairman, told Reuters.

Mahmood, who previously headed the internal alternative investment team at sovereign wealth fund Abu Dhabi Investment Authority, is also chief executive of the brokerage's parent ADS Holding.

The brokerage is a market maker in foreign exchange, Mahmood said, adding ADS aimed to begin trading in commodities such as oil and precious metals this year.

The firm is targeting institutions — as opposed to retail investors including some of the world's largest sovereign funds, pension funds and corporates who have hedging requirements in currencies and commodities.

Such investors have traditionally allocated capital heavily through investments in Europe, America and more recently, Asia.

Mahmood declined to name any clients but said the firm was catering to both local and foreign institutions. Some of these investors are also looking for personalised services and prefer their broker to have a local presence giving them expert advice and best prices, Mahmood said.

"Even though it's a small world today and the gap is being bridged by technology, it is a relationship business as well," Mahmood said, sitting in his plush office on Abu Dhabi's sea-front Corniche.

The firm employs about 75 people, mostly in Abu Dhabi, and is planning an office in Singapore.