Before buying or selling the most important Spanish shares, find out more about these companies and the factors to analyse.
To buy and sell the major Spanish stocks, it goes without saying that you need to know where they are listed, namely the Madrid Stock Exchange. While most European stock exchanges have now integrated the NYSE Euronext system, the Madrid Stock Exchange remains managed by a totally independent company, the Spanish Bolsas y Mercados, which also manages other important stock exchanges in Spain such as the Barcelona, Bilbao and Valencia stock exchanges. However, it is indeed on the Madrid Stock Exchange that you will find the major Spanish stocks since it is still the largest financial centre in Spain today but also one of the most important in Europe in terms of total capitalisation and volumes traded.
Nowadays, an electronic trading platform called SIBE is in charge of this exchange and its values. Thanks to the modernization of this system, the Madrid Stock Exchange has seen its trading volumes increase significantly compared to the old auction system. If you wish to follow the securities listed on this financial market, please note that its opening hours are 8:30 am for the pre-opening and 9 am for the first quotation. As far as the closing is concerned, it takes place at 5.30 pm with a closing fixing at 5.35 pm. These times are the same here as for other European stock exchanges.
The Madrid Stock Exchange is also linked to several stock market indices containing the major Spanish stocks. First of all, there is the general index of this stock exchange, which is the IGBM, but also the Ibex 35 stock market index, which is the Spanish benchmark index and to which you will return in more detail below. Note also that these two stock market indices are then broken down into several sub-indices allowing portfolio holders to compare their performance with that of the market in general.
By taking an interest in the Madrid Stock Exchange, you can follow some of the most interesting stocks in Spain, such as CaixaBank, Telefonica and Amadeus. There are also some companies whose headquarters are based abroad, such as the French company ArcelorMittal, to enable them to be more visible at European level or in the rest of the world. Be careful therefore if you only want to trade Spanish stocks since not all the stocks listed on this exchange are necessarily listed.
Of course, all the Spanish stocks that you will be able to trade with the CFDs of your trading platform are part of this Madrid stock exchange.
Spain has been one of the countries most affected by the economic crisis and, as a result, Madrid Stock Exchange shares have declined sharply in recent months. However, since 2015, investors are once again interested in certain company values.
Indeed, as the Spanish government has implemented a rigorous policy, the country's economy is gradually recovering and Spanish companies are now attracting many investors. If you are planning to trade over the medium to long term, you will have a choice between various Spanish stocks in the banking, insurance, energy, communications and agri-food sectors, which we will present to you below.
To further simplify your choice and allow you to view the major Spanish stocks in an instant, the ideal is to look at the composition of the country's benchmark stock market index, Ibex 35. Indeed, as mentioned above, it should be recalled that the Ibex 35 is the main stock market index linked to the Madrid Stock Exchange but also the benchmark index for the Spanish economy as a whole. As its name suggests, this index is composed of 35 shares of companies whose weight is itself weighted by total market capitalization.
The Ibex 35 stock market index is also an index correlated with other international stock market indices. Indeed, its annual performance is very often close to that of the US Dow Jones Index, the German DAX 30 Index, the French CAC40 Index or the British FTSE 100 Index, as in recent years there has been a strong dependence between the various world stock markets.
Are you interested in the Spanish stock market and want to invest some of your capital in it by buying stocks? There are several ways to do this today, which we will now explain.
Firstly, if you have a stock market investment product such as a securities account, you can use an online broker to place cash orders to buy Spanish stocks or sell stocks you already own.
It is also possible to buy Spanish stocks alongside other shares if you are looking for more diversification. For this, there are ETFs and mutual funds. EYFs generally track the composition of a stock market or sector index, which may be a Spanish index. FCPs or mutual funds are funds managed by professionals that are composed of different stocks, sometimes including Spanish shares.
Finally, you can also choose not to buy these Spanish stocks for cash but speculate on the price of these stocks using a derivative. This can include CFDs, which are contracts for difference that allow you to trade on the rise or fall of a Spanish stocks. Here, the gain or loss to the investor will simply be the difference between the share price at the time the position is taken and the share price at the time it closes and will of course be proportional to the amount invested.
In order to choose between these three methods of buying or selling Spanish stocks, you need to ask yourself certain questions, particularly with regard to your investment horizon, your objectives, your level of risk aversion and your investor profile.