40% increase in trading volumes of dual-listed shares on the Tel Aviv Stock Exchange (TASE)

Increase in share of TASE trades relative to total stock trading volumes in Israel and abroad

As international markets experience price declines, the Israeli market serves as an important anchor for dual-listed companies

TEL AVIV, Israel, June 1, 2022 /PRNewswire/ — According to Yuval Tsuk, Research Unit at the Tel Aviv Stock Exchange (TASE: TASE), Dual-listed companies, which are simultaneously traded on TASE and international stock exchanges, have a significant effect on the Israeli stock market, in general, and on indices headlights, in particular. 50 dual-listed companies are currently listed on TASE, most of which are concurrently listed in United States.

The TA-35 index comprises 10 double stocks, which accounted for 40% of the index’s weight at the end of March 2022and whose trades accounted for 35% of the total trades of all stocks in the index in the first quarter of 2022. The TA-125 index comprises 21 double stocks, which accounted for 33% of the index weight, and the trading which accounted for 27% of total trades across all stocks in the index.

Dual listing offers many benefits to businesses, investors and the Israeli economy. Among other things, Israeli and international investors can trade in both markets simultaneously and generate greater liquidity than that offered by a single market, the more diverse mix of investors makes it easier to raise capital in both markets and trading hours are longer. In addition, inclusion in major TASE indices and investments by ETFs and tracking funds on these indices also contribute to higher investment and trading volumes.

The dual listing also benefits the Israeli economy as a whole, as increased investment and trading volumes in dual companies also affect investment and trading volumes in high-tech companies. companies, both listed and private, which initially only had access to the Israeli stock market. Dependence on the US capital market is problematic. When international markets crash, foreign investors prefer to invest in local companies in their countries, which reduces their exposure to Israeli companies.

Dual listed companies are mostly medium to large capitalization companies in local terms and are household names in Israel. However, overseas companies are considered small caps, are less well known and are not usually included in major foreign indexes. In addition to the “domestic bias” advantage, these companies benefit from lower volatility on the TASE compared to overseas during upheavals or when they experience their own material event.

In the first quarter of 2022, the trading volume of dual-listed shares on TASE increased by 38%, reach a daily 473 million shekelscompared to an average daily trading volume of 343 million shekels in 2021. The trading volume of dual-listed shares was 25% of the total average share trading volume on TASE.

Since dual-listed stocks are traded simultaneously on two markets, Israel and overseas, we looked at the contribution of trading volumes on TASE to dual-listed companies, relative to their overseas trading.

Global trading of dual-listed shares(1) on TASE totaled a daily $147 million in the first quarter of 2022 – an increase of 40% compared to 2021 (in dollars).

Overall trading of overseas dual-listed shares totaled a US$402 million in the first quarter of 2022 – a decrease of 11% compared to 2021.

The share of trade on TASE this quarter compared to the total volume of trade in Israel and abroad is 27%, a significant increase from 19% in 2021.

For most dual-listed stocks that saw higher trading volumes in Q1 2022 compared to 2021, the volume of transactions on TASE increased more strongly than the volume of transactions abroad.

However, for most dual-listed stocks that saw declining trading volumes in Q1 2022, the decline in trading volume was more moderate on TASE.

Data shows that when international markets experience price declines, the Israeli market serves as an important anchor for dual-listed companies.



Evolution of trade volume in Q1-2022
compared to the year 2021

Trading volume on TASE

of total trade in Israel

and abroad (Q1-2022)

Number of

actions

TASE

Abroad

More than 75%

6

2%+

63%-

50%-75%

6

103%+

163%+

25%-50%

13

22%+

19%-

0%-25%

22

24%+

12%-

Total

47

40%+

11%-

(1) The trading volumes of the 47 dual-listed shares traded on TASE at the end of March 2022excluding foreign stocks not oriented to Israel (Pennantpark, Creative Media and UMH).

The volume of transactions on TASE represents more than 75% of transactions on Israel and abroad

For six of the companies, the volume of transactions on TASE represents more than 75% of the total transactions on Israel and overseas in the first quarter of 2022, the largest and most liquid of which are partners (97% on TASE) and Formula systems (76%).

For Icecure Medical, which was listed on the Nasdaq in August 2021transaction volumes on TASE were 84% in the first quarter of 2022.

The volume of transactions on TASE represents 50% to 75% of transactions in Israel and abroad

The largest and most liquid of the six companies in this category are LCI (74%), Elbit systems (56%) and Kenon Holdings (73%). It should be noted that the trading volume in ICL stock increased by 117% in the first quarter of 2022 compared to the average trading volume in 2021, but in United States it jumped 518%, reducing the share of trading on TASE from 89% in 2021 to 74% in the first quarter of 2022. Similarly, a sharp rise of 207% in Kenon Holdings’ trading volume on TASE, compared to 748% rise sharply United Statesreduced the share of trade on TASE from 88% in 2021 to 73% in the first quarter of 2022.

The volume of trade on TASE represents 25% to 50% of trade in Israel and abroad

For 13 companies, trading on TASE accounted for 25-50% of total trading in Israel and abroad, in particular Pleasantwhose trading volume on TASE increased by 33% in the first quarter of 2022 compared to 2021, while in United States its average volume of trades decreased by 2%, increasing the share of trades on TASE in all trades from 20% to 25%.

The volume of transactions on TASE represents up to 25% of transactions on Israel and abroad

The number of companies whose transactions on TASE compared to the total transactions on Israel and abroad was less than 25% or 22, of which Suits youwhose average trading volume increased by 16% on TASE but decreased by 19% in United Statesincreasing the share of its trade on TASE to 17%; Tower, whose average transaction volume on TASE tripled in the first quarter of 2022 compared to 2021, but increased fivefold in United Statesreducing the share of trade on TASE from 31% in 2021 to 20% in the first quarter of 2022; Ormat Technologies, with an 18% transaction volume on TASE in the first quarter of 2022, an increase from 14% in 2021, following an 8% reduction in the average transaction volume on TASE compared to a reduction of 30% United States.

Contact:
Orna Goren
Head of Communication and Public Relations Unit
Tel: +972 76 8160405
[email protected]

SOURCE The Tel Aviv Stock Exchange Ltd.

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