After a long period of economic crisis and the bankruptcy of the government´s finances, Greece is starting to recover. And it does so from a very low level. In this post, we analyze the most important stock market indices in Greece.
If there is one country that epitomizes the economic and sovereign debt crises of the Eurozone that began in 2009, it is undoubtedly Greece. The Hellenic country suffered one of the most serious economic depressions in modern history.
Among other things, its high public debt led to a series of bailouts by international institutions. However, the long-term unsustainability of its debt pile caused Greece to declare bankruptcy and have to restructure its financial obligations.
If investors in Greek sovereign debt lost money, most Greek bank shareholders were completely wiped out. And the rest of the listed companies in the country also experienced severe losses. In fact, Greece has had the worst stock market performance of any European country since the beginning of the century.
Nevertheless, it is still a country of more than 10 million people that is beginning to recover. This figure is down from the more than 11 million people that lived in the country before the financial crisis.
Greece´s nominal GDP per capita is slightly lower than that of Portugal. However, if we adjust it for the price level in the country, what is known as GDP PPP, the standard of living in Greece is not too dissimilar from what we can find in its northern neighbor Bulgaria.
As is to be expected, Greek stock prices are still very depressed. For those investors looking for bargains and cheap markets, Greece can be an interesting place.
Next, we analyze the most important stock market indices in Greece.
ASE – Composite Index
The Composite Index, also known as ASE (Athens Stock Exchange) Index, is the main stock market index in Greece. It was introduced in 1980 with an initial value of 100 points.
The ASE is composed of 60 stocks from the largest companies listed on the Greek stock exchange. These are weighted according to their market capitalization adjusted for free float.
It should be noted that most of these companies are rather small, as Greece does not have many large corporations. Two of its most prominent stocks are Jumbo and the Greek National Bank.
You can find more information about the ASE on the Athens Stock Exchange website.
FTSE Athex Large Cap
The FTSE Athex Large Cap is a stock market index managed by FTSE Russell and the Athens Stock Exchange. It was introduced in 1997 with the goal of better tracking the country’s large companies.
Thus, this index has only 25 stocks, making it easier for asset management companies to create passive investment vehicles through which one can invest in the Greek stock market. Some of its constituents are the Greek subsidiary of Coca-Cola, the airline Aegean Airlines, Piraeus Bank and Alpha Bank.
For more information about the FTSE Athex Large Cap, you can visit the Athens Stock Exchange website.
Finally, the US company MSCI publishes the MSCI Greece index. It is composed of all Greek stocks that are part of the MSCI Emerging Markets Index.
The number of stocks within the index fluctuates over time, but is usually around 10. Some of the most important ones are Eurobank Holdings and OPAP.
An interesting fact is that MSCI used to classify Greece as a developed country up until a few years ago. However, the severe economic crisis and the drop in its GDP per capita led to the Mediterranean nation being reclassified.
Within the MSCI Greece, companies are also weighted according to their free float-adjusted market capitalization. More details on the index can be found on the MSCI website.
I hope you found this post about stock market indexes in Greece useful. If you want to learn about another Southern European country, you can visit the following link:
Top 4 Stock Market Indices in Italy
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