According to the most recent official reports, foreign ownership of stock of UK-listed companies has hit a record high.

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Shadrach   in Stocks & Shares

Last updated: 15 January 2020, 06:50 GMT


According to the most recent official reports, foreign ownership of stock of UK-listed companies has hit a record high.

Investors from outside the UK held 54.9 per cent of British shares at the end of 2018, valued more than £ 1.03bn.

According to Office for National Statistics (ONS), the total value of stock on the London Stock Exchange was £ 1.88bn.

North America was the area with the highest interest in the chunk of stocks owned by foreign investors, responsible for 51.3 per cent of non-UK shareholders.

At 24.1 per cent and 15.7 per cent respectively, Europe and Asia led.

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Over decades, the percentage of London's stock held by the rest of the world has steadily risen, with ONS records showing such owners paid for only 7 percent of the market in 1963.

In the mid-1990s, investment increased with foreign investors owning 36 per cent of the stock by 2000.

The ONS said in its report:

The steady rise since 1994 reflects the growing internationalization of the UK stock market and the increasing ease with which overseas residents can invest in quoted shares in the UK (e.g. via electronic trading platform).

Large proportion of the rest of the world's shareholdings are shares in large multinationals.

British individuals increase holdings

While, the percentage of shares held by British-based people increased to 13.5 per cent, relative to 12.3 per cent in 2016.

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This index fell to a historic low of 10.2 per cent in 2008 but has since risen gradually.

The largest shareholders are family trusts, other financial institutions and insurance companies behind insurers and people in overseas.

The proportion of equity held by insurance companies has declined since peaking at 23.6 per cent in 1997. Those businesses paid for just 4 per cent in 2018.

The ONS said this represented a tendency for insurance companies to move away from UK investments and spend more in overseas assets.

At the turn of the millennium, public-sector share ownership hit rock-bottom, but was pushed up by the financial crisis as the government helped save some of the big banks.

The public sector kept 3 per cent of all the market shares by 2010. When taxpayer-owned securities are offloaded this has now reduced to 0.9 per cent. A majority stake in the Royal Bank of Scotland is still held by Parliament.