Share of Investors in Financial Instrument Turnover on GPW in 2021

  • Mar 18, 2022
Share of Investors in Financial Instrument Turnover on GPW in 2021

  • Retail investors generated 22 percent of equity turnover on the GPW Main Market in 2021 (-3 pps YoY). Foreign investors contributed 57 percent of turnover (+1 pps YoY) while Polish institutional investors generated 21 percent (+2 pps YoY).
  • On NewConnect, retail investors remained in the lead: their share in turnover was 88 percent (-4 pps YoY). The share of institutional investors grew to 7 percent (+3 pps YoY). The share of foreign investors increased to 6 percent, up by 2 pps YoY.
  • Polish institutional investors had the biggest share in futures turnover in 2021 for the first time in 10 years: they generated 41 percent (+5 pps YoY). The share of retail investors dropped by 9 pps YoY to 32 percent of turnover. The share of institutional investors increased by 4 pps to 27 percent, an all-time high.
GPW Main Market

Foreign investors generated the biggest share of equity turnover on the GPW Main Market in 2021, as in previous years. They generated 57 percent of turnover, i.e., 1 percentage point more than in 2020. Foreign investors generated 58 percent of turnover in H2 2021, i.e., 3 percentage points more than in H1 2021. Domestic institutional investors generated 21 percent of turnover in H2 2021, the same as in H1 2021 and 2 percentage points more than in 2020. The share of retail investors in turnover on the GPW Main Market was 22 percent in 2021, down by 3 percentage points year on year and down by 3 percentage points compared to H1 2021.

Market makers (with a share of 27.6 percent) were the leading group of institutional investors in H2 2021, followed by other institutions (27.4 percent) and investment funds (17 percent).

Table 1. Structure of investors on the Main Market in equities [%]

OTHER: Other institutional entities not included in any of the other categories - in particular state institutions and enterprises, cooperatives, foundations, associations, local government units, as well as KDPW and transactions concluded on the basis of aggregated orders and pending allocation orders referred to in Art. 2 clause 3. Commission Delegated Regulation (EU) 2017/580. Source: GPW data based on Exchange Members’ broker orders
NewConnect

On NewConnect, retail investors had the biggest share of turnover at 88 percent in 2021, down by 4 percentage points year on year. The share of foreign investors in turnover was 6 percent, an increase of 2 percentage points year on year. The share of institutional investors was 7 percent (up by 3 percentage points year on year). Market makers were the leading group of domestic institutions, accounting for 41.2 percent of equity turnover on NewConnect in H2 2021, followed by firms at 34 percent and other institutions at 15.4 percent.

Table 2.Structure of investors on NewConnect [%]

Derivatives Market

Domestic retail investors were outperformed on the derivatives market in 2021 by institutional investors. For the first time in 10 years, domestic institutions generated the biggest share in futures turnover at 41

percent in 2021, up by 5 percentage points year on year. The share of institutional investors in options turnover increased by 5 percentage points year on year to 25 percent. The share of individual investors in futures turnover was 32 percent in 2021 (-9 pps YoY) while their share in options turnover was 40 percent (-4 pps YoY). The share of foreign investors in futures turnover increased by 4 pps year on year to 27 percent, an all-time high. The share of foreign investors in options turnover was 35 percent, down by 1 percentage point year on year. The share of foreign investors and the share of retail investors on the structured products market was 49 percent and 51 percent, respectively.

Market makers were in the lead among all domestic institutions trading in futures in H2 2021: they generated 55.7 percent of total turnover, followed by other institutions (24.8 percent) and firms (13.7 percent). Firms generated the biggest part of options turnover (70.5 percent), followed by market makers (28.6 percent). Structured products turnover in H2 2021 was principally generated by firms (84.1 percent), followed by Exchange Members (13.6 percent) and market makers (2.3 percent).

Table 3.Structure of investors on the futures market [%]

The detailed results of the survey concerning the share of investors in financial instruments turnover are published on the GPW website at https://www.gpw.pl/analysis-investor-share-in-trading.

In presenting the data for 2021, GPW changed the method used to obtain data for calculating the share of investor groups in turnover on the exchange. Such information is now based on broker orders submitted to the Exchange’s trading system. As a result, the method of aggregating and presenting data on the percentage share of domestic retail investors was modified. The information on the number of online accounts is sourced from surveys conducted by GPW among domestic brokerage houses. The information on the number of active investment accounts comes from the Exchange’s trading system: it is the number of accounts for which at least one order was placed with GPW in the period under review.

History of the WSE

On 12 April 1991, the then Ministers of Ownership Transformation and Finance signed the Deed of Incorporation of the joint stock company "Giełda Papierów Wartościowych w Warszawie S.A." Four days later, on the day of the WSE's inaugural session, shares of five companies were traded and the turnover amounted to PLN 1990. Since 2018, the WSE has been classified as one of the 25 developed markets by the FTSE Russell agency. The history of the capital market on Polish soil dates back to the early 19th century. The first in Poland and one of the few in Europe, the Merchant Exchange, was established in Warsaw on 2 May 1817, soon became the largest market in Tsarist Russia, responsible for 5-6% of global securities trading. A thriving stock exchange, accounting for 90% of the domestic turnover, also operated in Warsaw in the interwar period. After the period of the People's Republic of Poland and the planned economy, it was not until 1989, with the political and economic transformation, that the Polish capital market was able to develop again.

Stock exchange today

The average EoB equity daily trading volume on the WSE was PLN 1,356.9 million in February 2022. The Main Market listed 427 companies (381 domestic and 46 foreign) and the NewConnect market listed 383 companies (379 domestic and 4 foreign) at the end of February 2022. In 2020, the WSE Group generated record sales of PLN 403.8 million and one of the highest ever net profits of over PLN 151 million. According to the Federation of European Securities Exchanges, in 2020 the WSE ranked first in Europe in terms of percentage increase in equity turnover and third in terms of the value of initial offerings. At the end of 2020, the WSE was also the second market in Europe in terms of liquidity and achieved the status of world leader in terms of the number of listed companies in the gamedev sector.

WSE position in the region

The WSE is the leader among stock exchanges in Central and Eastern Europe by the number of listed companies and the total capitalisation of domestic companies. The WSE's share in trading on stock exchanges in the region is 81%. The WSE leads the initiative of the Three Seas Stock Exchanges and aspires to the role of a regional hub for young technological companies with huge potential, the so-called unicorns. Negotiations are currently underway for the WSE to acquire a majority stake in the Armenian Exchange. The Warsaw Stock Exchange GroupGPW Group) operates trading platforms for shares, Treasury and corporate bonds, derivatives, electricity and gas, and provides indices and benchmarks including WIBOR and WIBID. The index agent FTSE Russell classifies the Polish capital market as a Developed Market since 2018. The markets operated by the GPW Group are the biggest in Central and Eastern Europe. For more information, visit www.gpw.pl.