Increased liquidity on the Spanish stock exchange
The Spanish stock exchange retains around 90% of
trading in the shares of listed domestic companies.
One of the reasons for this is surely the powerful down-
ward effect on trading costs of the concentration of
trading in a point offering the best supply and demand
conditions at all times.
In 2013, average spreads on IBEX 35 shares narrowed
spectacularly. In many cases, these were half or even
less than one year previously. Implicit transactions
costs, measured by the average buy-sell spread on the
IBEX 35 narrowed by 3.4 basis points in the year, from
0.102% to 0.068%. This positive development was
helped on the one hand by the incipient economic
recovery and, on the other, by the market returning to
normal following the lifting of the short-selling ban.
The concentration of trading activity in Spanish
company shares on the Spanish stock exchange made a
decisive contribution to materialising renewed investor
interest in equity instruments. Three Spanish stocks
had the highest trading turnover on the Eurostoxx 50
index, with Inditex in ninth position. Foreign investors
accounted for 80% of trading in the year, but house-
holds also increased their positions in 2013. This was
encouraged by the increase in the distribution of scrip
dividends and rights convertible into shares for some of
the largest listed multinationals. This explains why the
number of trades will be around 49 million, an all time
high in a year when the economic crisis appears finally
to be abating.
We cannot discuss liquidity on the Spanish stock
exchange in 2013 without talking about the compa-
nies that make up the IBEX Medium and IBEX Small.
The aggregate effective execution of transactions grew
by 122% and 179%, respectively, in 2013, resulting in a
narrowing of average spreads on these two indices.
Source: BME
20 12 2012
20 01 2013
20 02 2013
20 03 2013
20 04 2013
20 05 2013
20 06 2013
20 07 2013
20 08 2013
20 09 2013
20 10 2013
20 11 2013
20 12 2013
Average spread
Ibex Medium Ibex Top Divided FTSE Good Ibex Ibex 35
Business Areas
Report 2013
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