Over the last 15 years, the fund investment strategies have proven themselves on the Italian market heterogeneous. In the case of blue chips, total investments grew until 2018, and then began to decline. In the other two indices their presence is quite stable. The last two years (2022 and 2023) are characterized by a certain weakness in the ability of the Italian stock market to attract investorswith the sole exception of Mid Caps. This is what emerges from the seventh edition of the “Research Notebooks”, studies on the stock market published by Intermontean independent Italian investment bank, and created on an annual basis in collaboration with the School of Management of the Polytechnic of Milan.
The weakness of the domestic market
The Italian stock list, despite the overall increase in the number of listed companies thanks mainly to the contribution of Euronext Growth Milan, highlights today a lower capitalization to GDP ratio compared to that before the financial crisis of 2008-2009. The number of companies listed on the main exchange continues to decline and has been for the last 15 years lost several billion euros in terms of capitalisation because of frequent delistings (2.8 billion euros in 2023 alone).
If you look at the equivalent value of trade, in 2007 this amounted to on average 6.2 billion per day, compared to 2.21 billion (almost a third) in 2022 ei 2.27 billion in 2023. Furthermore, a large part of the trading continues to focus on blue chips, with an increase in the percentage over the last 6 years (from 87.7% to 89.9% in 2022), despite the arrival of many Small Caps on Piazza Affari.
THE North American funds they cover a important role and comparable to that of European funds on the FTSE MIBalthough in recent times US passively managed funds (ETFs) have partially replaced those under active management. Always the North American funds more secluded on Mid Caps (where European investors prevail), but their presence is instead relevant on Small Caps, where ‘active’ US funds also saw an increase in holdings. It certainly is the role of ETFs has grown and passive funds, which in 2007 were completely marginal in the system managed by Borsa Italiana. On the FTSE MIB they reached 26% of the total, on the Mid Caps and Small Caps they represent 16% and 10% respectively.
As for the Italian fundsthese show a substantially stable presence in blue chips, while they are more active in smaller capitalization segments. Their share has remained on the FTSE MIB in recent years around 10% (8% in 2023) of total institutional investments as a whole. If we look at other European countries, such as France and Germany, the weight of domestic investors is higher (25% and 26% respectively), while Spain is similar to Italy with a domestic weight of 8%. On Mid and Small Caps Italian funds have a greater impact, probably also thanks to the push of the PIRs from 2017 onwards. On Mid Caps these reached steadily close to 20%, compared to a pre-RIP average of 15%. On Small Capshad a strong boost in the first years of introduction of PIRs, which led them to a maximum of 34%, and then stabilized at around 30% of the total. It is also interesting to observe the positive return achieved by the Italian market over the years and not always correctly understood by the world of investors. If we look at the last 6 years (i.e. since the introduction of the PIRs) the historic FTSE Italia MIB recorded +37%, the FTSE MIB +39%, the FTSE Italia Mid Cap +5% and the FTSE Italia Small Cap +20%; in the last 15 years (analysis horizon of this research) the historical FTSE Italia MIB has recorded +84%, the FTSE MIB +56%, the FTSE Italia Mid Cap +159% and the FTSE Italia Small Cap +39%.