Investments and markets, Italian institutional investors look abroad


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The institutional investors domestic servants represented at the end of 2023 less than 2 billion euros of investments in the FTSE MIB, behind institutional investors from countries such as the United Kingdom (more than 3.5 billion), Europe (more than 6 billion) and the United States (more than 7.5 billion). A confirmation of the clear dominance of foreign funds in the corporate structures of Italian listed companies, resulting in significant impacts in terms of performance during periods of market stress, due to greater volatility of foreign investments compared to significant stability on the part of domestic ones. It is one of the findings that emerged from the research “The state of the art of investments in listed companies in Italy: evolution or involution? What future prospects?” presented during the eleventh edition of the conference promoted by EQUITA in collaboration with Bocconi University.

The preferences of Italian institutional investors

If you look at the Italian institutional investors so-called long term such as the Social Security Funds, i.e. those entities that are considered most important for the purposes of supporting the “Country System” (not only for listed companies but also for unlisted companies and for infrastructure investments), the percentage of assets invested in Italy is constantly decreasing, in favor of the share invested abroad. This dynamic can be attributed to the desire to diversify geographically but, above all, to the ability of foreign markets to offer interesting investment opportunities from a financial perspective. flexibility, type of products and performance.

The choices of pension funds and insurance companies

The same trend is confirmed by the composition of investments of complementary pension schemes, where the “Italian product” fell from around 28% in 2018 to Approximately 21% in 2022 of total investments, and where much of that percentage is attributable to government bonds and less than 1% is invested in domestic equities. Italian insurance companies also represent a long-term investor that over time has dedicated a very limited percentage of its investments to domestic stocks, between 2 and 3% of total assets.

How to reverse the trend

Among the conclusions of the research, a pwork program aimed at fill the structural and consolidated gaps in the Italian capital market compared to those of other economies in the short and medium term. Among the suggestions we find: the creation of investment funds large, capable of investing in listed SMEs and involving public entities and domestic financial institutions as anchor investors; the creation of a campaign dedicated to the subscription of listed shares, replicating the success of the BTP Valore initiative with new initiatives that could be called Italian Equity Value; the development of research activities on Italian listed companies through the creation of mutual structures for the benefit of the entire system; the inclusion of objectives linked to the development of the capital market in the tasks of the supervisory authorities; a review of corporate taxation, which allows the connection between savings e.g. to be supported in a structural mannereconomic development through capital markets.