Local investors have welcomed the implementation of new trading processes such as short selling and new indexes for the region.
But many feel the long-awaited merger of the Emirates' three stock exchanges would complete the UAE market reforms.
Nasdaq Dubai and the Dubai Financial Market (DFM) consolidated some operations in July last year, but a tie-up between the emirate's exchanges and the Abu Dhabi Securities Exchange has proved elusive.
But the UAE should press ahead with the merger of its bourses, said Brahim Razgallah, the chief economist for the Middle East and North Africa region at JP Morgan. "Economically, it makes sense to have this.
"It'll create deeper liquidity and will allow the UAE to become even a bigger player in the region. It'll help the UAE to consolidate on its importance as a financial hub and will ultimately bring more liquidity into the region."
Stock-market investors agreed local companies would see more interest from international buyers if the merger, which is being advised by Goldman Sachs, was carried through.
"If it was one platform and one market, it would be easier," said Yazan Abdeen, a fund manager at ING Investment Management. "It makes more sense for foreign investors not familiar with the region."
A merger of the UAE exchanges would create a deeper pool of liquidity that was more "normalised" than currently, when trading activity can swing wildly in favour of Dubai one day and Abu Dhabi the next, Mr Abdeen said.
The DFM, the only publicly traded exchange operator in the Middle East, has reported declining earnings during seven consecutive quarters, most recently recording a loss for the third quarter of Dh9.2 million (US$2.5m).
Profits have fallen as trading activity dwindled, with the value of stocks traded on the emirate's stock exchange last month equivalent to just 2.6 per cent of the peak in November 2007.
The slump in volumes has forced about half of the UAE's brokerages out of business.
Tie-ups between local and regional exchanges are often seen as a solution to weak trading levels in "frontier" markets where individual markets' infrastructure is underdeveloped and traded volumes are thin.
The Bourse Régionale des Valeurs Mobilières has served as a central exchange for eight West African countries based in Ivory Coast since 1998. The East African Community - Kenya, Uganda, Tanzania, Rwanda and Burundi - announced plans to develop a regional commodity exchange in July, although international investors have complained that trading on the individual stock markets of the five African nations has remained anaemic. In developed markets, a wave of cross-border bourse mergers among global exchanges have run into difficulty, with the Australian government vetoing in April a takeover of the Australian Securities Exchange by Singapore Exchange.
Merger talks between NYSE Euronext and Deutsche Börse have also been put on hold, pending a review by European competition regulators due for completion on January 23. The merger would create the world's biggest exchange.