Saudi Exchange launches market-making framework to boost liquidity

DUBAI, Dec 5 (Reuters): Saudi Arabia's stock exchange said on Sunday it was launching a market-making framework for its stock and derivatives markets to help ensure liquidity and raise price-determination efficiency.

Entities must be exchange members, derivatives exchange members or their clients to be market makers.

"Market Makers have to ensure the availability of liquidity for a listed security by providing continuous quotes throughout market open session," the Saudi Exchange, also known as Tadawul, said.

"The Saudi Exchange will monitor compliance with Market Maker obligations, and will provide incentives to the Market Maker after obligations are met."

Dubai, with which Riyadh has a deepening economic rivalry, announced in November last year a 2 billion-dirham market-maker fund to boost trading on the stock market, with a goal of doubling its size to 3 trillion dirhams.