A Beginner's Guide for investing on TADAWUL in KSA
What is TADAWUL?
TADAWUL is the Saudi Stock Exchange where you can invest in various types of investments like company stocks, bonds, and funds.
Are You Eligible to Invest?
To trade on the Saudi Stock Exchange, you need to be either a Saudi or GCC national or a registered Saudi Arabian resident.
As an expat, you need to be a registered resident in Saudi Arabia or got pre-approval in UAE in the broker.
Are you International Investor?
International investors can access the Saudi capital market through the Qualified Foreign Investor (QFI) program. Requirements include a completed QFI details form, a certificate of incorporation or equivalent documents, evidence of regulatory status, most recent annual report and accounts, audited financial statements, and any details of suspension of any license or permission by a regulator.
Finding a Broker:
You need a broker to start investing. Brokers are companies that are authorized to buy and sell investments on the exchange on your behalf.
Look for a broker that is a member of the Saudi Exchange. They can help you set up an investment account. Usually it takes from 15 minutes to maximum 1 day.
Setting Up Your Investment Account:
Visit or share on-line with your chosen broker your documents (Iqama and passport, EmiratesID).
They will help you open an investment account. This is where your investments will be held.
Understanding What to Invest In:
TADAWUL offers different things to invest in, like stocks (shares in companies), bonds (a type of loan to a company or government), and funds (a collection of different investments).
As a beginner, start by learning about these options. You don’t need to invest in everything. Choose what you’re comfortable with. Read our section on Investment principles, and how to Start with.
Learning About Risks:
All investments have risks. Stocks can go up and down in value. It’s important to understand these risks before you start and assess your risk-appetite.
Making Your First Investment:
Once your account is set up, you can start investing. You might want to start small as you learn.
Your broker can help guide you on how to buy and sell investments.
Long-Term Perspective:
Investing is often best done with a long-term view. This means thinking about what your investments might be worth in many years, not just today or tomorrow.
Tips for New Investors
Risk Tolerance: Understand your risk tolerance. DFM might be more suitable for lower risk tolerance as it focuses on local companies, while ADX, with its international exposure, might involve higher risk.
Research and Diversification: Conduct thorough research on potential investments and diversify your portfolio to spread risk.
Start Small and Learn: Begin with smaller investments and gradually increase your portfolio as you gain more experience.
Stay Informed: Keep up with financial news and market trends.
Regular Check-ins:
Periodically review your investments. This helps you understand how they’re doing and if you need to make changes.