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5. Access to all the investor community

There are several types of investor in the Stock Exchange. Each one, with its own ways of operating, is tracking new companies in which to place funds

Being a listed company means gaining access to the large volume of funds from these investors. Their objectives make them the ideal financial partners for any company: they seek value added, both via price rises, as well as dividends. They do not interfere in the daily management of the company, although they are demanding as regards the results. They are not only interested in large companies; they need to complete their investments with large growth potential companies, be they small or medium sized.

Various types of investors operate on the stock market at any given time. Due to the globalisation and internationalisation of businesses and markets, in 2013 nearly 80% of the turnover for equity products, mainly shares, in the Spanish exchange was generated by foreign investors.

Since 2010, Santander, BBVA and Telefónica have repeatedly been the most actively traded stocks in the euro area. Important factors in this phenomenon are the quality and diversified nature of these assets as well as constant improvements to the securities market which in turn attract greater liquidity and encourage access to the Spanish exchange. At 31 December 2012, foreign investors owned 40% of the market value of all the securities listed in Spain (see attached). This is followed by households, which account for 25% of the shares traded.

Historically, and particularly since the wave of privatisations in the 90s, Spanish households have been very active in the stock market, especially when compared to other developed European markets. Of the 230 IPOs and secondary offerings registered in Spain between 1986 and 2009, 40% of the new securities were bought by households. Despite the crisis affecting new listings, this trend has continued in recent years. Spanish households have been more than prepared to expand their share portfolio by taking part in the various corporate transactions aimed at deleveraging and shoring up equity (mainly capital increases). These figures underscore the stability of this investor group in the Spanish bourse which is, without a doubt, helped by the secure and flexible ways in which all investors can access the market.

Listed companies do not have to seek out investors one by one. The stock market provides them

In short, listed companies have a base of investors used to investing in projects and assuming risks. They do not have to seek out investors one by one. The stock market provides them.

Access to different types of investors enables listed companies to design, to a large extent, the type of shareholder they want and, above all, have a stable base of shareholders.

The capacity to control the composition is greater when the listing is accompanied by a share offering or subscription, when the type of shareholder sought can be defined more precisely..

A listing enables a company to precisely design the type of shareholder required

As is natural, the daily transactions on the stock market change the shareholders and over time the distribution between the different types of investor. Thus process can be estimated by the company through various tools. In general, the more active the company is in investor relations, the closer it will find itself to its needs and movements.

In any case, all investors share a common denominator: to obtain the best value for their investment. A clear dividend policy and one balanced with the long-term performance of share prices will satisfy all investors.

 

 

 

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