(BFM Stock Exchange) – Sweden is only the eighth economy of the European Union. And yet, the Stockholm Stock Exchange has the largest number of listed companies on the old continent. How to explain that this country which has fewer inhabitants than Île-de-France has such a market depth?

When we talk about the financial markets, the quidam or the most initiated have as a reference the New York, London, Tokyo or obviously Paris scholarships. And not the Stockholm Stock Exchange, which acts as a dwarf.

However, the Place de Stockholm is full of companies that are known to the general public or whose products are used on a daily basis.

Volvo, H&M and Assa Abloy

Volvo is the perfect example. The automotive group which has refocused on heavy goods vehicles and industrial devices is the third largest capitalization of the Stockholm Stock Exchange, with a market capitalization (the value of all of its shares) of almost 50 billion euros, according to data from CompaniesmarketCap.com.

Just below, we can cite Assa Abloy who is the world leader in door opening solutions and access for consumer and professional markets. This company, which is at the doors of the 30 billion euros in capitalization is better known in France for its Vachette brand, which was integrated into the Swedish group in 1997.

Another example: the Swedish giant of ready-to-wear H&M (Hennes & Mauritz), which has some more local brands like Monki, Weekday, & Other Stories or Cheap Monday. Despite its world notoriety, the group weighs only 19 billion euros on the stock market, a little less than the capitalization of Veolia.

The Swedish online music service by Spotify subscription claims a market capitalization of 126 billion euros. But the Swedish platform is not part of this ranking of the most important values listed in Stockholm, the company having favored a quotation on the New York Stock Exchange in April 2018.

For comparison, the Paris Stock Exchange has nine companies exceeding this threshold of 100 billion euros in capitalizations (Hermès, LVMH, L’Oréal, Schneider Electric, Essilorluxottica, Totalenergies, Safran, Air Liquide, Sanofi).

A rating renewal

But it is not so much the big stock market capitalizations that make the strength of the Swedish square as the number of its residents. At the end of 2024, 953 companies were listed on the Stockholm Stock Exchange, according to an OECD report devoted to the Swedish financial market. By way of comparison, France has only 686 companies listed on the stock exchange and Germany 767.

Close to $ 1,000 billion, the total market capitalization of the Stockholm Stock Exchange represents 159% of the gross domestic product (GDP) of Sweden. This is clearly higher than the major economies of the old continent such as France (102%), the United Kingdom (88%), the Netherlands (81%) and Germany (50%).

Another speaking figure: more than 16% of Swedish companies with more than 250 employees are listed, against only 3% in Europe in 27. The figure is 3% in France and even falls within 2% in Germany, recalls the monthly letter Vernimmen which recently focused on the attractiveness of European financial markets.

“Consequently, it is not surprising that the number of new quotes on the Stockholm Stock Exchange since 2013 (501) exceeds over the same period the cumulative amount of IPOs in Paris, Frankfurt”, argue the authors of the letter.

Indeed, the Stockholm Stock Exchange escapes the drying up of the equity markets, unlike other stock market seats. Including the Paris Stock Exchange which has seen the number of its residents constantly retreating since 2021. In Sweden, this has not been the case since 2014, 1,059 companies have joined the Swedish market, against 537 radiation, a net increase of 522 companies, according to the OECD count.

By way of comparison, the stock markets in the countries of the European Union outside Sweden experienced net radiation almost each year between 2014 and 2024, a total net loss of 773 companies.

Tax carrot and capitalization

Yet Sweden comes from afar, even from far away. In the early 1980s, the Scandinavian country was not even a member of the European Union – it will integrate it in 1995 – and its capital market was one of the most closed and regulated in the world, recalls The Government Offices of Sweden in a report entitled “Sweden’s Capital Markets Journey” or the Swedish financial market.

The Swedish economy was therefore hard. The country then carried out several economic and structural reforms. This moult has gone through measures to encourage Swedish households to place their woolen stockings in the country’s equity market.

The first tax incentives for savings on the capital markets were introduced in 1978 with the “Aktiespond” or “actions for everyone”, in French.

The purpose of this system was to expand shareholding in Sweden. In 1984, these first measures were replaced by a form of similar incentive fiscalness savings “German”, or “funds for everyone”. The effect was palpable: in the early 1980s, almost half a million Swedish were directly invested in the stock market.

They are now more than 2 million people (almost a third of the adult population) to directly hold shares on a listed company, according to data from the Swedish Securities Market Association cited by the OECD.

Not to mention their investment through pensions or investment funds, which are the cornerstone of the dynamism of the Swedish stock market. Swedish pension funds manage more than 800 billion euros in assets, more than a fifth of the European Union total, according to the OECD report.

Most Swedish public pension funds allocate more than half of their total portfolios to actions, with significant exposure to national companies, reports this same OECD report.

The preponderance of these actors is the direct consequence of the design of the Swedish pension system. In the 1960s and then 1990, Sweden operated a major reform of its retirement system, which introduced a share of capitalization in addition to the distribution system with defined contributions.

“Sweden has long favored a culture that encourages the use of stock funding, which is visible throughout the market, whether it is the distribution of assets of the different categories of institutional investors, the composition of household financial assets or use by market -based finance companies”, also details this OECD report.

This explains a strong appetite by Swedes for equity investments, which represent 42% of the country’s household savings. This share drops to 23% in France and even 17% in Europe in 27, detail the authors of the Vernimmen letter.

Pedagogy

However, the strong involvement of private investors is beneficial for the Swedish equity market, especially for small businesses. During the first seven months of 2022, the small carriers represented almost 30% of the total volume of transactions on the First North Growth Market (the equivalent of Euronext Growth, the small values compartment in Paris). In addition, they play a key role in the contribution of liquidity in the market during the IPO.

For example, in 2021, the year marked by a strong activity on the IPO, private investors represented 35% of the transactions within 10 days of the Volvo because (one of the largest public offers ever made in Sweden). The participation of individuals was even higher during the IPO of the CTEK battery leader, since it reached 45%.

Financial culture is also the cornerstone of the dynamism of the Swedish market. The authors of the Vernimmen letter, explain that a real effort of education and awareness of financial issues is initiated from high school. Retirees from the financial industry go to the country’s high schools, to teach the finance bay.

However, the development of a financial culture in a country is essential to its inhabitants in order to make judicious financial decisions in difficult economic contexts, recalls the OECD/INFE which carries out an international study on the level of financial culture every three years.

Initiatives in France

The third French Tech Finance Partners report, published at the end of January already rented this dynamism of the Swedish stock market, cited as an example to follow to revitalize the Parisian coast.

“Facilitating rating in France makes it possible to trigger a virtuous circle: more companies on the Paris Stock Exchange means more jobs in France, more employees benefiting from stock options, and a possibility of reinvestment in new businesses from venture capital funds”, explains French Tech Finance.

France has already carried out several initiatives to try to improve the attractiveness of the Paris Stock Exchange in a context of high attrition of the tricolor coast, and intense competition with other international places.

In March 2024, the Autorité des Marchés Financiers (AMF) had softened the rules on IPOs, raising the obligation for companies wishing to join the Parisian place to reserve part of their shares for private investors. Previously, they were forced to offer small holders a minimum of 10% of the overall amount of the operation.

This measure allowed two companies to enter Euronext Paris in the months that followed. The project management specialist for Planisware companies, and the exose defense company took advantage of this relaxation of the rules to launch on the stock market in April and June 2024 respectively.

This measure was followed a few months later in the voting in June of the attractiveness law, aimed at facilitating the IPOs on hexagonal soil. She had narrowly escaped the earthquake of the dissolution of the National Assembly.

This text introduces the principle of multiple voting rights to boost the IPO. “This faculty (actions with multiple voting rights, note), open in most major global financial centers (…) has the main advantage of promoting the rating of small and medium -sized (SMEs) innovative, in particular in the field of tech, by guaranteeing their founders or their managers that they will be able to maintain a control of the company’s strategic choices after the Introduction on the Stock Exchange. Senator Louis Vogel’s report.

The measure must therefore dopy the IPOs in Paris, by encouraging the founders and owners of companies more to get started.

For the moment, few companies have dared to take the plunge since the summer of 2024. There are … three. This figure includes the specialist in artificial intelligence Lighton, the specialist in precision mechanics Odyssey Technologies at the end of 2024 and more recently SEMCO Technologies, a manufacturer of components dedicated to the semiconductor industry, which is for the time being, the only fellowship of the year 2025 in Paris.

The renewal of the rating may go through the rendezvous of defense companies. In May 2025, Euronext announced several measures aimed at promoting the financing of companies in this sector which ended up in the spotlight with the renewed geopolitical tensions.