Bid/Ask Spread of Croatian and Slovenian Blue Chips in 2023

Today, we are bringing you a quick overview of the bid/ask spread of the Croatian and Slovenian blue chips in 2023.

First of all, a reminder: what is a bid/ask spread? In the context of a stock exchange, a bid/ask spread represents the difference between the highest price a buyer is willing to pay and the lowest price that a seller is willing to accept, for any share in question. In other words, the bid/ask spread represents the transaction cost for any given trade. As such, the lower the bid/ask spread, the more attractive a share could be for trading. Several things influence the bid/ask spread. Firstly, of course, the liquidity of a given share. Liquidity is tied to both the size of the share’s free float, the attractiveness of the share at any given moment, and the size of the overall stock market, among other things.

As such, the more liquid a share is, the more investors will trade it, and subsequently, the lower the bid/ask spread will be. The opposite is also true; illiquid and small shares usually have large bid/ask spreads, which in turn makes them even less attractive to investors, which creates a self-fulfilling circle. Secondly, the influence of a market maker. In short, a market maker puts a large enough amount of shares, available for trading by all investors on both the bid and ask side of the trading on an exchange, for a certain fee. Due to this, companies with market makers, even ones that are smaller and less interesting to investors can reduce their bid/ask significantly, thus making them more attractive in turn.


Starting with the Croatian blue chips, the Croatian blue chips retained relatively small bid/ask spreads in 2023. Oscillations on certain days did happen when major news broke out, but on average the spread was quite small.

Average bid/ask spread of Croatian blue chips in 2023 (%)

Source: Bloomberg, InterCapital Research

Out of the observed companies, HPB recorded the largest bid/ask spread at 1.9%. 2023 for HPB was a stellar year, with the stock recording app. 71% growth during the period, on the back of really strong fundamental results. This spurred investor interest for the stock, which also meant that the price was volatile, but with an upward range. Combined with the fact that HPB does not have a dedicated market maker, the bid/ask spread was often even larger, ranging from -4% to 9%, which also somewhat contributed to price growth.

Next up was Končar, a company that does have a dedicated market maker, but also recorded 62% growth, also on the back of very good fundamental growth. Due to this, its bid/ask ranged from -2%, to 5% in the period, albeit it should be noted that it stood around the average for most of the period.

For Atlantic Grupa and Ericsson NT, the bid/ask was also over 1%, but unlike the aforementioned companies, both of these companies were under pressure in 2023 due to higher cost growth associated with inflation. We can also see that in the bid/ask spread, as it ranged between -3% and 5% for Atlantic Grupa, and -2% and 6% for Ericsson NT, showing that despite Atlantic Grupa having a dedicated market maker and Ericsson NT does not, volatility was name of the game in 2023.

The remaining companies, excluding Atlantska Plovidba all have dedicated market makers, and considering that they all are some of the most traded stocks during the year, and no major news really happened that could have introduced even more volatility, their bid/ask spreads remained <1%. This could also be one of the many reasons (if we were to exclude the fact that companies such as Podravka and Span recorded strong double-digit growth) why these stocks seem so attractive; not only are they liquid but the transaction cost in terms of the bid/ask is negligible.


Moving on to Slovenia, out of the 9 blue chips, 3 had average bid/ask spreads higher than 1%.

Average bid/ask spread of Slovenian blue chips in 2023 (%)

Source: Bloomberg, InterCapital Research

Leading the way in this regard is Equinox, the newest addition to the SBITOP index, and also the smallest company in terms of size compared to others. Furthermore, the Company’s share price increased by app. 5% during 2023, but if we were to look at the price movements, we can see a lot of volatility in the Company’s stock price. This is one of those examples of a.) Smaller and less liquid company, especially compared to other Slovenian blue chips, and b.) Lack of a dedicated market maker. In this case, accomplishing the latter could surely help with the former.

Next up we have Luka Koper and Telekom Slovenije, both of which recorded solid double-digit growth in 2023, at 30% and 27%, respectively. Here we can see the effect of solid liquidity by both companies; although Luka Koper does not have a dedicated market maker and Telekom Slovenije does, their average bid/ask spreads were pretty similar.

Of the remaining Slovenian blue chips, all of them had a bid/ask spread of less than 1%. Given the overall size of the Slovenian market, especially in terms of the available number of shares for trading, a lot of trading is concentrated in all of these stocks, especially in Krka, NLB, and Petrol. The remaining blue chips, Triglav, Sava Re, and Cinkarna Celje also recorded solid liquidity in 2023. We can also see here the direct benefit of a market maker on their trading; even with this high of liquidity, it is unlikely that the spread would be as small as it is without it.

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