The El Salvador stock market has shown remarkable dynamism in the first eight months of this year. According to the Monthly Securities Bulletin from the Superintendence of the Financial System (SSF), the stock exchange recorded 5,669 transactions totaling $2,918.4 million through August. This represents a staggering 71.3% increase compared to the same period in 2022.
The same report indicates that in August, the country’s stock market saw 785 transactions amounting to $450.4 million. Notably, the primary market, where investors acquire assets directly from issuers through a brokerage house, accounted for 32.1% of the trading on the El Salvador Stock Exchange (BVES).
In this scheme, the year-over-year growth was an impressive 77.8%, reaching $937.2 million. Among the most traded instruments are investment certificates with $527.3 million and bond securities totaling $157.3 million. On the other hand, the SSF report highlighted that in the secondary market, where investors resell the securities they purchased, $239.9 million was traded, representing 8.2% of the total traded on the BVES.
Meanwhile, in the repurchase agreement (repo) market, where short-term loans involve the temporary transfer of securities as collateral, $1,095.6 million was traded, accounting for 37.5% of the total transactions.
The repo market recorded the second-highest growth, with a year-over-year increase of 107.9%. Most of the transactions were negotiated for terms between five and eight days, with a weighted average yield of 6.2% in August.
Investment Fund Growth
SSF reported that as of the end of August, both open-end and closed-end investment funds experienced year-over-year growth of 24.39% in their assets, equivalent to $107.58 million more than the same period the previous year.
With this increase, these funds, which serve as collective investment vehicles for money and other supervised assets, reached a total of $548.69 million, demonstrating investors’ confidence in the regulation and opportunities offered by the domestic stock market.
Currently, there are four fund managers and ten investment funds, seven of which are open-end (allowing investors to enter and exit at any time) and three are closed-end.
It’s important to note that the assets under management for open-end funds amounted to $186.3 million, while closed-end funds held $362.4 million in assets.