Six things you did not know about the Finnish capital markets05.11.2010
1.The Helsinki Stock Exchange is part of the global NasdaqOMX group
Helsinki Stock Exchange started trading in 1912. The stock exchange has continued its operations in the same Stock Exchange Building in the center of Helsinki for almost hundred years. The building was donated to Finnish Foundation for Share Promotion in 1985. Helsinki Stock Exchange became part of OMX group in 2003 and part of Nasdaq in 2007. Now the stock exchange is called NasdaqOMX Helsinki.
Interior: Stock Exchange Building
2.The Helsinki Stock Exchange was among the first exchanges in the world to move to fully electronic trading
Starting April 1990 all trading at the Helsinki Stock Exchange has been fully electronic. Since February 2010 Helsinki moved to use the same trading system, Inet, with six other Nordic and Baltic exchanges (Stockholm, Copenhagen, Reykjavik, Tallinn, Riga and Vilnus). This system is considered extremely fast and reliable. Instead of having their own chair in the exchange room, the traders now have their own server in one of the secret Nasdaq OMX server buildings in Stockholm.
3.Almost half of the shares in Helsinki Stock Exchange are owned by foreigners
The companies listed in the Helsinki Stock Exchange include some internationally known large companies such as Nokia, Kone and UPM-Kymmene. Thus it is not a surprise that Helsinki has been able to attract significant amounts of foreign capital. Almost half of the shares are held by foreigners. The market value of the Helsinki Stock Exchange in the end of September 2010 was 155 billion euros according to Bank of Finland.
Nokia head office in Espoo, near Helsinki.
4.Finnish households are active investors
20 percent of the shares on Helsinki Stock Exchange are held by Finnish household investors. The population in Finland is 5.3 million and the number of individuals with direct share ownership is about 780 000 (according to Euroclear Finland in October 2010) which accounts to about 15 percent of the population. During the financial crisis in 2008 stock prices went down, international institutional investors sold and domestic households increased their share.
5.Helsinki Stock Exchange offers international exposure
According to a study conducted by Deutsche Bank Finnish large cap companies offer a diversified and truly global investment – their revenues come from different continents (e.g. large portion from Asia), being most diversified of all countries compared.
6.Helsinki Stock Exchange has offered great historic returns
Average annual return of the Helsinki Stock Exchange after inflation in 1912-2007 was 10 percent (before inflation as high as an average of 18 % return annually) according to a study conducted by two Finnish professors Mika Vaihekoski and Peter Nyberg.