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S&P AFE 40 Index

January 09, 2012 | About:
Standard & Poor’s has launched the S&P AFE 40 index. This index is designed to measure the performance of 40 leading companies from the Gulf region. The S&P AFE 40 is comprised of the 40 largest stocks listed on AFE member exchanges. These stocks are subject to certain restrictions such as the limitation of ten stocks per country. The index uses a capped market capitalization weighted index scheme. The S&P Index partnered with the Arab Federation of Exchanges (AFE) to create the index. It includes companies from Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Palestine, Qatar, Saudi Arabia, Tunisia and the United Arab Emirates.

This index goes a great way toward providing access to investors that have been locked out of the region. It might also compel new investors to consider investment in the Gulf region. The impact would be both financial and social. Oil-rich nations often have the capital to support local businesses.

Gaining investment exposure to the Middle East is also achieved through the WisdomTree Middle East Dividend (GULF) and the Market Vectors Gulf States Index (MES). Both of these funds provide undervalued leverage for the region. As the market matures there is a growing interest among investors in Arab equities. The liberalization of Arab countries through protests is signaling a new era of Middle Eastern investment opportunities. Now individual investors have more access to invest in this region. This would result in better financial profits and a showing of solidarity for the Arab Spring participants. After all, investments are just monetary votes of support.

About the author:

Mary Posey
I am an avid fan of financials and investing. I regularly contribute to Seeking Alpha as well.

Visit Mary Posey's Website


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