During 2004 and 2005, there were significant increases in the volume of shares traded and the share prices of many companies. But, towards the end of 2005 and through the first few months of 2006 the bubble has burst and share values dropped by around 60% on DFM, along with similar decreases in most other Gulf stock markets.

DFM is one of three markets in the UAE. Abu Dhabi Securities Market (ADSM) also lists mostly UAE companies and the recently opened Dubai International Financial Exchange (DIFX) was set up to trade international markets.

Dubai Fiscal Market Dubai business was situated as a public institution. It has its own independent corporate body. DFM is operating as a secondary market for trading of securities issued by public shareholding companies, bonds issued by the Federal Government or any of the Local Governments and public buildings in the country, units of investment funds and any other financial instruments, local or strange, which are accepted by the Market. The Market commenced operations on 26th March 2000.

Dubai Financial Market has two composite systems for the daily processes of selling, clearance and settlement. These are Clearance & Settlement System and Trading System.

Clearance & Settlement (CSS) is a universal automated system used to conduct the daily routine work of clearance and settlement. On the other hand, Trading System is an automated system used by the brokers for their daily operations. It also enables both the brokers and investors to monitor spot orders of buy and sell.

The two systems are electronically linked and the completion of a deal on the trading floor simultaneously modifies securities holders’ register in the Clearance & Settlement System with immediate transfer of securities. Investors, thus enjoy integrated and secure service to conduct their buy or sell orders.

All securities of listed issuers are placed in the Clearance & Settlement System, which eliminates the need for the physical exchange of safety certificate and renders the process safer and more efficient.

Here are two basic requirements for the Investors to start trading in DFM:

1) Obtain Investor Number (IN) from DFM after filling in “Investor Number Form” at the Investor Services Office or with a DFM accredited agent .

2) Open an account with a DFM accredited broker using “Account Opening Form”.

There are some documents appended with “Investor Number Form” which have separate requirement for each category.

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