RIYADH: Saudi investors’ trading in US stocks through financial institutions licensed by the Capital Market Authority grew during the first quarter of this year, marking the seventh consecutive quarter of year-on-year growth.
According to the financial analysis unit of Al-Eqtisadiah newspaper, based on CMA data, the value of Saudi trading in US stocks during the first quarter reached approximately SR241.9 billion ($64.5 billion) in both buying and selling, representing a 47.2 percent increase compared to the same period last year.
Despite this annual growth, trading volume declined by about 5 percent compared to the previous quarter, coinciding with the volatility witnessed in US markets during the first quarter. Major indices were pressured by concerns related to tariffs and economic policies before recovering some of their losses later.
Saudi investors’ trading in the US market accounted for approximately 28 percent of their total trading activity across various financial markets during the first quarter, compared to about 18 percent during the same period last year. The Saudi market maintained its position as the largest share of trading activity, accounting for approximately 69 percent of total trading, despite a slight decrease in its share.
Saudi trading in US stocks is divided into two types: the first is conducted through financial institutions licensed by the CMA, and the second is conducted directly through foreign brokers. Official data on the volume of trades executed outside of local institutions is unavailable.
Trading volume does not reflect asset value
Despite the continued growth in trading on the US market, these figures do not necessarily reflect the actual size of assets held by Saudi investors in foreign markets.
Data from the CMA indicates that the value of client assets in securities listed on foreign markets reached approximately SR36.5 billion by the end of the first quarter, representing a 71 percent year-on-year increase and a 2 percent rise compared to the previous quarter.
The significant difference between trading volume and asset value reflects the nature of investment activity in foreign markets, where a large proportion of transactions tend toward frequent trading and the recycling of liquidity, particularly in the US market, which is characterized by high liquidity levels and the availability of financial instruments that facilitate speculation and short-term trading.
Despite the rapid growth of foreign assets during the past year, they remain limited compared to the size of investment assets within the local market. According to available data, the value of individual assets in Saudi stocks alone amounts to approximately SR884 billion, meaning that assets held in foreign markets represent a limited percentage of domestic investments.
Record trading volumes in European markets
In parallel with increased activity in the US market, European markets recorded the highest trading levels for Saudi investors since data became available in 2015.
The value of trades in European markets jumped to approximately SR11 billion during the first quarter of this year, compared to SR1.8 billion for the same period last year, an increase of more than sixfold.
This surge coincides with growing global investor interest in the technology and artificial intelligence sectors, along with improved performance across several European markets in recent months, which has enhanced their appeal to investors seeking investment opportunities outside the US.
