Securities Atop Stock Market Sectors

EghtesadOnline: Financial securities topped the stock market sectors in terms of trade value in the month to October 22, according to a report by the Central Securities Depositary of Iran.

News ID: ۷۴۹۰۰۰

23 November 2019

The report covers the performance of different industries active in the stock market and shows that financial securities topped the list of the biggest stock market industries with total trade value of 171.32 trillion rials ($1.42 billion).

Trade value of financial securities experienced a significant rise compared to a month earlier when the it stood at 85.91 trillion rials ($715.91 million).  The rise is mainly ascribed to deals in the Manfa’at Sukuk bonds during the reviewed month.

Last month the government issued 49.9 trillion rials ($440 million) in Manfa’at Sukuk securities for its budgetary needs.  Bonds were issued on the request of the Economy Ministry and offered on Iran Fara Bourse, the over-the counter stock market, to help augment government deficit spending, Financial Tribune reported.

Manfa’at Sukuk is a type of Islamic financial instrument that states one’s ownership of a certain service or future profit of a lasting commodity transferred for a certain price.

Securities can help meet businesses’ immediate needs for liquidity with no access to an end-user to finance their operations.

The CSDI’s report also indicates that exchange-traded funds stood in second place with total trade value of 98.03 trillion rials ($816.92 million).

An ETF owns underlying assets (shares, stocks, bonds, oil futures, gold bullion and foreign currency) and divides the ownership of assets into shares.

Holding multiple underlying assets rather than just one, an ETF can own hundreds or thousands of stocks across various industries, or it could be active in one particular industry or sector.

Banks and credit institutions ranked third with trade worth 53.86 trillion rials ($448.84 million).

Base metals industry, automotive industry, pharmaceutical industry and chemical products were next.

This was followed by oil products, coke and fuel industry, food and beverages (except sugar and sugar cube) and investment companies.

At the bottom of the list were companies active in entertainment and creative industries, followed by the tanning industry.

Iran’s capital market has four branches, namely Tehran Stock Exchange, Iran Fara Bourse (over-the-counter market), Iran Energy Exchange and Iran Mercantile Exchange.