How to Invest in Iceland


This guide is for intrepid investors who are wondering how to invest in stocks in Iceland and Nasdaq Iceland. Curious about investing in other frontier markets? Check out a list of our guides here.

Iceland, the Scandinavian island nation of roughly 330,000 people, has had a tumultuous past decade. It suffered disproportionately during the financial crisis of 2008 since it had unabashedly embraced financial deregulation in the previous decade, causing its finance industry to become massively leveraged – at one point the total debt was equal to about 160,000 EUR per citizen in Iceland. To its credit more bankers have been jailed in Iceland as a result of this activity than other country in the world.

Its stock market has been a roller-coaster ride for investors. Those who invested at the height of the market in 2007, right before the crash, have still not recovered the majority of their stake. Those who got in post the crash have enjoyed healthy returns. And those who invested a long time ago and held it all this time.. have been almost flat over 20 years.

But the country has clearly rebounded and is now a major tourist destination. Its GDP has yet to reach 2007 levels, but it has grown steadily since 2009. The darkest days of Iceland are clearly in the past, and with a stock market still down almost 80% from its peak, there might be some value to be found for bargain hunters.

Here is the table of returns for the OMX Iceland All-Share Index:

Time Period Index Lvl Total Return (ISK) Total Return (USD) Annual Return (ISK) Annual Return (USD)
Now (2017)  1,392.45
Past Yr
(Since Jan 2016)
 1,319.96 5.5% 29.3% 4.1% 21.1%
Past 2 Yrs (2015)  956.44 45.6% 74.8% 17.4% 26.9%
Past 5 Yrs (2012)  580.73 139.8% 178.0% 17.8% 21.1%
Past 10 Yrs (2007)  5,857.50 -76.2% -84.0% -13.0% -16.2%
Past 20 Yrs (1997)  889.37 56.6% -1.1% 2.2% -0.1%

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Iceland’s economy has averaged roughly 1-2% growth per quarter the past 5 years, with a stunning 11.3% yoy growth rate in 4Q of 2016. The IMF forecasts Iceland’s GDP growth to be the highest in Europe in 2017. This in a country that already has a very high GDP per capita (PPP) of over 40,000 USD.

The financial industry used to play a major part in Iceland’s economy, but in the fallout of the financial crisis in 2008, it still has not recovered and no banks are even listed on the exchange. However, as a relatively advanced economy, about three-quarters of GDP still comes from services, with about 20% in industry and 5% in agriculture.

The fishing industry is the main agricultural component of GDP, while aluminum is Iceland’s largest export. Iceland is also the largest electricity producer by capita in the world thanks to its geothermal plants.

Here is a visualization of Iceland’s main exports:

Tourism has become a major growing source of the economy, and the success of Icelandair’s stopover strategy is undeniable. It is estimated that roughly 1.5 million tourists visited Iceland in 2016, 4.5x the local population, and that the industry contributes over 5% to GDP already.

Iceland’s credit rating is currently investment grade: A with S&P, A3 with Moody’s, and BBB+ with Fitch.

Notable Companies in Iceland:

  • Marel (Ticker: MARL): the largest stock by market cap on the exchange, the main company involved in the fishing and agricultural industry
  • Ossur (Ticker: OSSRu): second largest stock by market cap on the exchange, a healthcare company focused on prosthetic aids
  • Icelandair Group (Ticker: ICEAIR): runs its namesake airline company along with a number of hotels and other tourist operations
  • Landsbankinn (Not listed): the national bank of Iceland is currently 81.33% owned by the Icelandic government
  • Arion Bank (Not listed): the third largest (smallest) of the nationalized banks, but with an investment to foreign investors including Goldman in April, is expected to be the first to be re-listed on the exchange later in the year
  • Alcoa Fjarðarál (Not listed): Icelandic subsidiary of Alcoa, which runs the aluminum industry in Iceland
  • CCP Games (Not listed): the developer of Eve Online, one of the longest running online role-playing games in the world

Is It Safe To Invest In Iceland?

According to our Investment Safety Rankings, Iceland is ranked #12 on our list, making it one of the safest countries in the world to invest in. You would be hard pressed to find a safer place to invest in, although you must be weary of potential capital controls as an investor.

Can Foreigners Invest In Iceland?

Yes, foreigners are allowed to invest in Iceland. Capital controls are also no longer applied when trying to get money out.

Nasdaq Iceland / ICEX Snapshot:

In operation since: 1985, equity trading since 1991

Location: Reykjavik, Iceland

Market hours: 09:30 to 15:30

Currency: Icelandic Krona (ISK)

Market Capitalization (as of May 2017):1.07 trillion ISK (~10.2 billion USD)

Local Listed companies (as of May 2017): 17 listed stocks

Taxes: 20% on all capital gains, dividends, capital income

Foreign currency controls: currently none, capital controls imposed in 2008 were lifted in March 2017

Main Index: OMX Iceland All-Share Index:

How the Iceland Stock Exchange / Nasdaq Iceland is Structured:

The Iceland Stock Exchange (ICEX) merged with OMX in 2006, and was acquired by Nasdaq in 2007. The joint company, Nasdaq OMX, operates exchanges throughout Scandinavia and Eastern Europe, sharing the INET trading platform.

Nasdaq Iceland has equities, bonds, and a single ETF, and also has derivatives trading. There is also First North (previously Iceland iSEC in Iceland), which is that alternative stock exchange for smaller growth companies to be listed.

Local Companies Listed on Nasdaq Iceland:

There are 17 companies total listed on the exchange, market cap as of 5 May 2017:

Company Name Industry Mkt Cap (mio ISK)
Marel HF Industrials  267,747
Ossur HF Health Care  177,051
Icelandair Group HF Tourism  78,000
Reitir fasteignafelag hf Financials  77,364
Eimskipafelag Islands Hf Industrials  64,700
Hagar hf Consumer Services  64,081
HB Grandi hf Consumer Goods  57,400
Reginn HF Financials  46,037
Eik fasteignafelag hf Financials  43,315
Siminn HF Telecom  40,530
Sjova-Almennar Tryggingar hf Financials  29,686
N1 HF Consumer Services  29,188
Vatryggingafelag Islands Hf Financials  25,858
Tryggingamidstodin HF Financials  23,833
Fjarskipti HF Telecom  17,141
Nyherji HF Technology  13,762
Skeljungur HF Oil & Gas  13,374

How to Invest in Icelandic Stocks and Nasdaq Iceland:

As a member exchange of Nasdaq OMX, Iceland’s stocks are hosted on a modern trading infrastructure. However, due to the size of its market, it is hard to find a standard broker that allows for investment on the Iceland stock exchange. For example, Interactive Brokers offers access to other Nasdaq OMX exchanges like Norway and Sweden but not Iceland.

This means you need to open an account with a local member of the Iceland stock exchange. According to this list, there are 14 firms authorized to trade on the exchange. Given the size of the market, there aren’t any online brokerages focused on retail clients, so for retail investors your best bet is to open an account with one of the main local banks, such as Landsbankinn. Foreign non-residents are allowed to open bank accounts, and from there you can open a stock brokerage account. Fortunately, everyone in Iceland speaks English so it should be much easier than usual.

Make sure to check out our other investing guides here!

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