A study on the development of Portugal’s capital market was unveiled today in Braga, providing a comprehensive overview of the sector, including its impact on companies and households.
In 2021, only 13% of Portuguese households owned stock market-traded instruments. Financial wealth was concentrated in deposits, accounting for about 22% of total wealth, while stocks, bonds, and funds made up a mere 0.6%.
The study indicates that participation in capital markets is largely determined by household wealth rather than income and also reflects substitution effects with investment in home ownership.
The CMVM highlighted that older, wealthier households tend to participate more in the markets, while younger individuals from less affluent backgrounds show a higher relative propensity to invest.
Family composition also influences investment decisions, with retirees’ presence increasing participation, whereas children’s presence tends to inhibit it.
Higher education levels within a household are positively linked to financial market participation, as are net savings, voluntary pension plans, multiple savings objectives, risk tolerance, and the level of financial market development.
For companies, stock market listing is associated with increased access to long-term financing and higher investment levels, as well as a slight reduction in debt costs and tax burden.
Listed companies and their subsidiaries demonstrate greater productivity, with venture capital beneficiaries showing higher export propensity and intensity, while listed firms have a lower export propensity.
The findings show that companies issuing private debt have a higher proportion of short-term debt and lower return on equity, while those supported by venture capital exhibit higher return on equity.
Access to capital markets in Portugal is linked, albeit differently depending on the financial instrument used, to significant advantages in productivity, profitability, and credit quality, confirming its potential as a complementary financing mechanism to traditional bank credit.
The study was commissioned by the CMVM and conducted by an academic consortium from the Universities of Minho, Porto, and Coimbra.
