VSE: International Investors Dominate Vienna Stock Exchange

Published: April 12, 2016; 17:47 · (FriedlNews)

International institutional investors are largest group of investors on the prime market of the VSE Vienna Stock Exchange. They account for some 78 percent of institutional free float of the prime market index ATX Prime stocks, according to a study.

VSE: International investors dominate Vienna Stock Exchange / Picture: © Wiener Börse AG

Austria’s leading listed companies prove to be particularly popular with international investors - around 78% of investors at the Vienna Stock Exchange are from abroad.

The largest group of investors in Austria’s leading companies come from the US, with a share of 27.65% (31 Dec. 2014: 24.6%).

Austrian institutional investors come next, with a share of 21.9% (31 Dec. 2014: 19.1%).

Thus, domestic institutional investors increased their relative share year on year by approximately 15%.

The United Kingdom comes third in the ranking of institutional investors with 15.7% (31 Dec. 2014: 14.7%), followed by Norway with 7.2% (31 Dec. 2014: 6.3%).

•    78.1% of identified institutional money in the free float of Austria’s leading companies held by international investors
•    Also domestic institutional Investors increased their share in 2015
•    Ranking of institutional investors: US is ahead of Austria, UK and Norway
•    Investment trends: Growth and value investment styles, and passively managed funds

According to a study on the free float of Austrian prime market companies as of 31 December 2015 conducted by information provider Ipreo on behalf of the Vienna Stock Exchange. The study particularly analysed the origin and motivation of institutional investors.

“The findings of our annual study of investors clearly show that international investors recognize the value of Austrian stocks and continue to buy strongly,” stated management board members of the Vienna Stock Exchange, Birgit Kuras and Michael Buhl. “This is made possible not least due to a transparent and professional communications policy. The Vienna Stock Exchange supports the efforts of the listed companies by organizing international road shows on a regular basis. This gives them an ideal opportunity to present themselves to select international investors.”

Constant inflow from the US

Throughout the year 2015, US investors have been constantly increasing their share of investments in Austrian companies. Through concentrated buying in a few financial stocks, US investors strongly increased their holdings in ATX prime stocks in 2015. What is remarkable is the fact that demand from US investors was not only driven by large investment firms. The results of the study show that investments in individual stocks have a key influence on the distribution of investors. Apart from major traditional investment firms mainly passive fund manager increased their share in 2015.

Active trading driven by risk aversion

Norway, France and Germany continue to be the leading continental Europe countries invested in the ATX prime. Nonetheless, there were net outflows – with the exception of Norway – from several European countries such as Germany, Switzerland, the Netherlands, France and Poland in 2015. A number of sovereign funds also pulled money out of the ATX prime. The decline of the oil price and also the turmoil on the Asian markets were probably key factors driving the reshuffling of portfolios. Political events such as the refugee crisis, and the quantitative easing and interest rate policy of the ECB also had an influence on investors’ risk aversion, according to the study.

Additional liquidity inflows came from alternative investors such as hedge funds and “deep value” investors. As regards investment styles, passively-managed funds are increasing in popularity. At the moment 15.3% of institutional investors are investing based on an index. The top motivation of institutional investors for an investment in Austrian prime market stocks continues to be growth (37.1%) and value (33.8%) investment styles.