Stock Trading Among Greek Individuals Climbs to Five-Year High

Individual Greek investors accounted for 40 percent of trading in the nation’s stocks during September, the highest level for the month since at least 2007, according to Athens Exchange Chairman Socrates Lazaridis.

That’s a 10 percentage point increase from last year, data provided by Hellenic Exchanges SA as of Sept. 28 showed. Overseas institutions, such as pensions and mutual funds, made up 35 percent last month, down from 46 percent a year ago, based on a statement from the exchange.

“In 2012, we’ve seen an increase in the participation of local investors in trading activity,” Lazaridis said in an interview at Bloomberg’s New York headquarters yesterday. “It is the first time that local investors have shown more activity than international investors. Confidence starts from the local community.”

The Athens Stock Exchange Index (ASE) has surged 74 percent since its 2012 low on June 5 and has posted the third-biggest gain out of 24 developed market benchmark gauges this year, according to data compiled by Bloomberg. The measure is still 84 percent below its 2007 peak.

The benchmark for Greek equities tumbled 52 percent last year as the country struggled through a sovereign debt crisis and speculation that it would leave the 17-nation euro. New International Monetary Fund forecasts put Greece’s debt at 182 percent of gross domestic product in 2013, up from an April forecast of 161 percent and making it harder to reach a target of 120 percent by 2020.

Foreign Ownership

Foreign investors owned 50 percent of the market value of stocks listed on the Athens Stock Exchange last month, according to Lazaridis in the interview. About $14.5 million has flown into the U.S-listed exchange traded fund Global X FTSE Greece 20 ETF (GREK) this year, according to data by New York-based research firm XTF Inc.

“What is also important is to see that foreign investors did not abandon the Greek market,” he said. “Some foreign investors left, but there were some new investors who came in.”

Individual investors made up 27 percent of trading in Greek equities during September 2007 before the financial crisis began, while international institutions accounted for 56 percent at the time, the data show.

Greece has been mired in a recession since 2008. While the country has narrowed its deficit from more than 15 percent of gross domestic product in 2009 to 9.1 percent last year, it faces continued austerity measures and budgets cuts that have crimped consumers and businesses. Economists surveyed by Bloomberg predict Greece’s economy will contract through 2014.

German Chancellor Angela Merkel arrived in Greece yesterday for the first time since the debt crisis began in 2009 after the finance ministers yesterday hailed the country’s determination to cut its budget and reshape its economy, raising the chances that aid will keep flowing to Greece.

To contact the reporter on this story: Inyoung Hwang in New York at ihwang7@bloomberg.net

To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net

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