Middle East Investments: 3 Ways To Invest Your Money In UAE

If you’re seeking sustainable foreign investments, the UAE offers some of the most outstanding facilities of all nations. However, as powerful or encouraging as the concept of investing may seem, everything may go wrong if appropriate decisions are not made at the proper time. It entails determining the amount to invest, the location of the investment, and the method of acquisition. This article will analyze why you should consider investing in the UAE, your best investment alternatives, and how you can get started.

Why Investment in the UAE?

Investing in the UAE is simple. Overseas investments are very convenient regarding legislation, regulations, and financial stability that stand very facilitative to business. Moreover, as one of the world’s most liberal economies with a globally oriented business culture, the UAE is a secure, investor-friendly global hub.

The UAE government has designated free zones in Dubai and Abu Dhabi to promote foreign investment. Foreign businesses are encouraged to locate in free zones. In addition, the UAE government has taken a number of initiatives to modernize the free zones and bring them into line with a more western economic environment. Several measures are in place in the Free Zone, including the following:

  • Eligibility to form a wholly-owned overseas subsidiary
  • Their distinct free zones are governed by their own legal system and courts, which have jurisdiction over corporate, commercial, and civil matters.
  • International investors benefit from laws that are written in the English language.
  • Tax-free zone 

Where To Invest In UAE?

The UAE’s economy is now one of the most diverse in the GCC. Here it can be observed in the reduction of oil and gas contribution of GDP from 41% in 2000 to 31% in 2015, as well as the over 400% growth in industrial infrastructure investment. Therefore, there are always plenty of options to choose from. First, however, here are some popular choices of the foreign investors:

UAE Stock Market

Purchasing stocks (shares) is a well-known strategy for individuals and institutions to invest in. Stocks enable you to own a portion of a business. When you hold a stock, you earn money either in these 2 simple ways:

  1. Dividend
  2. Increase of Stock Price

The UAE government invites both nationals and non-residents to its exchange hubs to purchase and sell equities in UAE exchanges. UAE has 3 stock exchanges:   

  • Abu Dhabi Securities Exchange (ADX)
  • Dubai Financial Market (DFM)
  • NASDAQ Dubai

But you have to trade through a regulated broker. As the whole middle east stock market is volatile, be advised to choose a broker that covers not only UAE exchanges but also other exchanges in the whole middle east allowing you to buy non-UAE hot stocks like

Saudi Aramco, Al-Rajhi Bank Ltd. and so on.

Real-Estate Investments In UAE

One can’t help but see why Dubai is such an attractive place for real estate investors, given the city’s rapidly expanding population and its reputation as a secure, cosmopolitan, and worldwide commercial center. In addition, a solid passive income stream and capital appreciation have made real estate a perfect investment alternative in the UAE since its inception.

When you purchase an apartment and rent it out, you are buying the potential to make a considerable amount of money. For example, net rental income for a property in Dubai is typically between 5% and 7%, which means that a one-million-dollar flat may bring in between 50,000 and 70,000 dirhams in yearly passive income.

The rights of real estate investors in Dubai are safeguarded by a series of real estate rules and regulations. Foreign investors have flocked to Dubai’s property market since the long-awaited foreign property ownership decree was issued in 2002, allowing non-UAE residents to purchase property in Dubai for the first time. 

Investment In National Bonds In UAE

The National Bonds initiative is open to all citizens of the UAE (Emiratis) and permanent expats. Anyone above the age of 21 may purchase National Bonds. The interest rates that may be given to investors in the UAE fluctuate on a year-to-year basis. Profit margins are greater than those of banks, which averaged 2.89% in 2016, according to a 2016 study. As a result, national Bonds have historically yielded more significant returns than bank savings accounts.

According to a 2016 research, National Bonds worth less than AED 10000 made a profit of 1.42%. On the other hand, bonds worth more than AED 100,000 produced a 2.89% return. Additionally, bondholders stand to receive 20% of the income generated by national bonds each year.

Conclusion

These were some of the most considered options for investing in the UAE. However, no matter how lucrative it seems in the first place, every investment opportunity has its own advantages and drawbacks. Therefore, you must not jump into any options without considering the outcomes. Always conduct your own research before putting your hard-earned money at stake.

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