Market Making: What This Week’s UAE Trading News Means
Learn how market making can affect share liquidity and trade execution, and what this week’s UAE-related news says about the firms behind trading.
Market making has featured in several recent industry announcements, including new services linked to Dubai shares and appointments on overseas exchanges. For UAE retail traders, the topic is useful because it explains one way markets can support buying and selling—while also showing that an app may depend on several firms for trading, account services and data handling.
Key takeaways
- Market makers provide buy and sell quotes that may support liquidity, but they cannot guarantee a fill or a particular execution price.
- Gulf News reported that EFG Hermes UAE launched market-making and liquidity-provision services for DFM shares, with benefits described as expected rather than certain.
- Zawya reported BHM Capital’s appointment as a market maker on Kazakhstan Stock Exchange, while PR Newswire reported a separate institutional-business appointment at Sky Links Capital.
- Arabian Business reported a DriveWealth data breach and Wio Invest’s statement that its own systems and services were unaffected and customers’ holdings remained safe.
- A retail investment account may involve several firms performing different roles, so a platform’s app may not be the only relevant service provider.
What market making means
A market maker is a participant that regularly offers to buy or sell a financial instrument. By placing prices on both sides of a market, it can give other participants more opportunities to trade without waiting for a matching order to appear naturally.
The difference between the price offered to buy and the price offered to sell is called the spread. A market maker may help make it easier to trade, but it does not guarantee that every order will be filled immediately, at a particular price, or without a price difference. Liquidity—the ease of buying or selling without a substantial effect on price—can vary between instruments and over time.
Market makers may earn revenue from the spread or other permitted activities, and they can face the risk that prices move while they hold positions. Their presence does not remove market risk or ensure that a share’s price reflects what an individual investor considers fair value.
How market making can affect a trade
A market maker is one part of the trading process, not the whole process. Orders may pass through a platform, a broker or an intermediary, and the market where a trade is executed. Depending on the arrangement, other firms may also provide custody, clearing or technology services.
| Market feature | What it can mean for a trader | What it does not guarantee |
|---|---|---|
| Buy and sell quotes | More visible prices at which market participants may trade | That a trade will happen at either quoted price |
| Greater liquidity | Orders may be easier to match in some conditions | A stable price or easy exit in every market condition |
| A narrower spread | A smaller difference between displayed buy and sell prices | Lower overall risk or a better investment outcome |
| Thinly traded shares | Fewer available orders may make execution less smooth | That a market maker will always be present or able to fill an order |
The price shown on a screen can change before an order reaches execution. The final result can depend on the instrument, current market conditions, order type and the arrangements used by the relevant broker and venue.
What this week’s market-making news reports
Gulf News reported on 12 October that EFG Hermes UAE had introduced market-making and liquidity-provision services for shares traded on the Dubai Financial Market (DFM). The report said the services could support liquidity, pricing efficiency and smoother transactions, particularly for securities with limited trading volumes. These are expected benefits described in the report, not a guarantee of how an individual trade will execute.
Separately, Zawya reported on 6 October that BHM Capital had announced its appointment as a market maker on Kazakhstan Stock Exchange, following a recently announced appointment on Astana International Exchange. The item described this as part of the company’s international expansion.
A different kind of expansion appeared in a 5 October PR Newswire announcement: Sky Links Capital appointed a managing director to lead institutional business development and expansion. The announcement described the firm’s institutional offering and said its UAE entity operates as an introducing broker under a Category Five licence, does not hold client funds, and does not provide investment advice. This is the company’s description in the announcement; it is not a report about new market-making services.
Taken together, these items point to activity across market infrastructure and brokerage services, but they concern different firms, markets and services. A market-making appointment, a new liquidity service and an institutional-business appointment are not interchangeable, and none by itself establishes what a retail customer’s execution or account experience will be.
The firms behind a trading app
The other significant retail-facing report this week concerned data handling. Arabian Business reported on 6 October that a DriveWealth security breach exposed personal and investment data globally. The report said Wio Invest, which uses DriveWealth to execute and hold US investments, told customers that its own systems and services were not affected and that their securities and other holdings remained safe.
According to Arabian Business, Wio also said customer information had been provided to DriveWealth when US investment accounts were opened, under the terms and conditions customers accepted. The report illustrates how an investor may interact with one app while other firms help provide brokerage, custody or technology services. It does not establish that every platform uses the same arrangement.
Arabian Business said Wio reminded customers it would not ask for passwords, PINs, card numbers or one-time security codes, or instruct them to transfer money to protect an account. A message claiming to be from a financial platform should be treated cautiously, especially if it asks for sensitive details or an unusual transfer.
Tip: Read account notices through the platform’s official channels, and be wary of unsolicited messages asking for security codes or transfers.
Questions to understand the service
When reading about a platform or a market-making announcement, it can help to separate the service being discussed from the account relationship. These questions can clarify what a news item does—and does not—tell a retail customer:
- Which service is involved? Market making, order execution, custody and account technology are distinct functions.
- Which entity provides it? A familiar app name may not be the only firm involved in an investment account.
- Which market and instrument are covered? A service concerning DFM shares does not automatically apply to US investments, other exchanges or CFDs.
- What is confirmed, and what is an expectation? Reported launches and appointments are distinct from predicted benefits such as improved liquidity.
UAE financial services operate across different regulatory settings, including the SCA onshore, the DFSA in DIFC, the FSRA in ADGM and VARA for virtual assets in Dubai. The relevant framework depends on the activity and entity; a headline about one firm or market should not be taken as a statement about every platform.
Trading carries risk, and this article is general information, not financial advice.
Frequently asked questions
What does a market maker do?
A market maker regularly offers to buy or sell an instrument, which may give other market participants more opportunities to trade. Its presence does not guarantee an immediate fill or a specific price.
Does market making guarantee better liquidity?
No. Market making may support liquidity, but conditions can change and liquidity can vary between instruments and over time. The Gulf News report described expected benefits from EFG Hermes UAE’s DFM services, not guaranteed outcomes.
What did the news say about the DriveWealth breach?
Arabian Business reported that the breach exposed personal and investment data globally. It also reported Wio Invest’s statement that its own systems and services were unaffected and customers’ securities and other holdings remained safe.
Can one investment app involve several companies?
Yes. An app may be the point a customer interacts with while other firms provide functions such as brokerage, custody or technology. The specific arrangement depends on the platform and account.
BrokerBazaar is a technology platform that helps traders and brokers find information, compare options and resolve issues. We are not a regulator, ombudsman, law firm or arbitration service, and we do not determine legal liability or guarantee any specific outcome.