Last issue I made the case for why the Tadawul deserves a place in a GCC expat's portfolio.
This issue is about how I actually built mine. Four positions. Real logic. No retrospective brilliance, just the honest account of how it came together.
THE FOUR POSITIONS AND WHY I CHOSE THEM
Aramco
This was the first and most obvious entry point. The world's largest energy company, listed on home soil, paying a substantial dividend, and deeply embedded in the global energy supply chain.
I did not buy Aramco because I had a sophisticated view on oil prices. I bought it because it is the most visible, most liquid, most discussed company on the exchange. For a first position on an unfamiliar market, starting with the most understood name made sense.
What I underestimated: Aramco's dividend yield is its primary attraction for most investors. The capital appreciation story is more complicated. If you are buying it for growth, you are probably buying the wrong name.
Al Rajhi Bank
The largest Islamic bank in the world. Sharia compliant by structure, not by retrofit. Dividend paying with a track record that holds through cycles.
For a GCC-based investor building a Sharia-compliant portfolio, Al Rajhi is the anchor position most people reach for first. I reached for it second. The logic is straightforward: a deeply embedded financial institution in an economy that is structurally growing its financial sector as part of Vision 2030.
Jarir Bookstore
This one gets the most questions. Why a bookstore?
Because Jarir is not really a bookstore. It is a consumer electronics and lifestyle retailer with a loyal GCC customer base, consistent cash flows, and a dividend track record that holds up even in difficult years.
It is also under-owned by international investors who have never heard of it. Smaller local firms that lack international visibility may face liquidity drain as capital gravitates toward high-quality, index-heavy names. Jarir sits in an interesting middle ground, well known locally, almost invisible internationally. Yahoo Finance
Saudi Sukuk
The stabiliser. Islamic fixed income. When equities move, this barely moves.
I added Sukuk not because I expected it to generate returns but because a portfolio without a fixed income component is a portfolio with no shock absorber. The sukuk market has deepened considerably as part of the Financial Sector Development Program under Vision 2030, which means the instruments available are more varied and more liquid than they were even three years ago. Omniacapitalgroup
WHAT I WOULD DO DIFFERENTLY TODAY
One thing only: I would add a Saudi ETF from the beginning rather than reaching for individual names first.
Saudi Arabia's IPO pipeline for 2026 is among the most active globally, with approximately 40 IPO applications under review at the end of 2025, spanning sectors including energy, healthcare, financial services, real estate, mining, and technology. Omniacapitalgroup
In a market this active, broad ETF exposure gives you participation in the entire growth story without the concentration risk of picking individual names. You can always add conviction positions on top of an ETF base. It is much harder to unwind a portfolio of individual stocks when you realise you have accidentally concentrated too much in one sector.
THE SEQUENCING THAT WORKED
Start broad. Add conviction positions over time. Never put more than 20 percent of your Tadawul allocation in any single name in the first year. Let the market teach you before you take a strong view on any one company.
That is the framework I wish I had started with. It is the one I am using now.
Next issue: The one number on the Tadawul I check every quarter, and what it tells me about the health of the whole market.
— The Quiet Compounder