With difficult macroeconomic conditions and rising interest rates increasing the cost of living across many countries worldwide, the importance of carefully managing your money has never been clearer. Consumers are now considering saving and investing their money to maximise their income.
One company aiming to open up capital markets, and increase consumers’ ability to buy and sell assets, is the trading and investment platform eToro. Earlier in December 2024, eToro announced it was partnering with the Abu Dhabi Securities Exchange (ADX) to add a number of ADX-listed stocks to the eToro platform.
It believes the move will help enable a greater proportion of retail in the UAE to access ADX-listed stocks, with only 42 per cent currently exposed to them. eToro aims to capitalise on the region’s strong growth trajectory, as well as support the UAE’s economic vision.
To find out more, The Fintech Times caught up with Josh Gilbert, market analyst at eToro at Abu Dhabi Finance Week (ADFW). Gilbert first shared eToro’s overarching aims when it comes to impacting the investing landscape: “We’re aiming to break down complex financial topics so that the everyday investor can better understand them.
“Unfortunately, people just don’t have necessarily receive the right education when it comes to finance and investing. So that’s what we’re really passionate about – providing that education and making sure that no topic is too complex.”
Investing in the Middle East
Josh Gilbert, market analyst at eToro
Gilbert also broke down why eToro was focusing some of its efforts in the likes of Abu Dhabi and the UAE: “The region is a great fit for us – the innovation, the technology, makes it an exciting place to be. We also believe is a little bit untouched regarding investing as well.
“Of course, there’s a lot of wealth here in the region as we very well know. The ADX market performance has been pretty stand out over the last couple of years, when compared to global markets. As a result, we feel there’s a real opportunity here from both the economic side, as well as the companies that are being built here. We want to offer that opportunity to people in the area.”
He also explained the importance of offering investors the ability to buy and sell stocks in companies that are based locally to them. “We realise, having spoken to our investors over time, that there’s a very big home bias. We find it quite a lot in Australia. People love to own their local stocks because they understand the businesses more so than they would other stocks. So to be able to open that up and offer those local offerings to clients here is really important.”
Differing focuses
But this concept isn’t just true in Australia and the Middle East. eToro has also been making local stocks available across Europe. Gilbert highlights these efforts, but notes that investor attitudes and focuses still differ from region to region:
“We’ve recently just announced a partnership with the London Stock Exchange (LSE), and the Deutsche Börse exchange in Europe. We’ve added over 500 LSE assets, as well as over 500 more European stocks.
“But every geographical market offers something slightly different, right? You go to London which is very focused on healthcare; you go to the US which is very focused on technology. Abu Dhabi and ADX can offer something slightly different as well, whether that be tech innovation or what’s happening on the ground here. Being able to offer every type of market is really important for us.”
Diversifying your portfolio
Historically, education about investment has been all about traditional stocks. But now digital assets have well and truly established themselves in this space.
“We are really starting to see both worlds converge. Now, a big part of what we promote is that diversified portfolio. We don’t want someone to come to retirement and just own crypto or just own stocks. We want them to consider both.
“When we see people starting out with traditional assets, we also suggest that adding even a small amount of crypto into the portfolio is a good idea. Bitcoin has the best risk-adjusted returns of any asset. Given crypto’s performance over recent years, it has shown why it deserves a place in a portfolio, even if it is just a small allocation.
“However, on the flip side, if you are very heavy in crypto, I think what we’ve seen over the years as well is where crypto has seen these outsized returns. It makes up a very large amount of a portfolio just because of those gains, right? Just being able to add in stocks or commodities, is a good idea to better protect yourself.”
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