Capitalization of the Russian stock market: Prospects and sources of growth

Abstract

The article explores the growth prospects for the Russian stock market capitalization, aiming for an increase from 24.7% in 2025 to 66% of GDP by 2030. The methodological framework includes an extensive literature review on capitalization dynamics and its determinants, a comparative and economicstatistical analysis of stock market and financial sector indicators, and proprietary approaches to estimating and forecasting the long-term equity risk premium and other financial market parameters. By benchmarking target development parameters against actual dynamics observed in 2020—2025, the study provides a quantitative assessment of the required growth rates for capitalization and related metrics for 2026—2030. The findings indicate that for achieving these objectives sustainable demand for equities from both institutional and retail investors is needed. The study argues that a critical condition for capitalization growth is a reduction in the real risk-free rate and the equity risk premium, resulting from macroeconomic policies focused on disinflation and a more balanced interest rate structure. Furthermore, the paper identifies structural constraints within the domestic savings system, including a high concentration of assets among a limited group of investors and the insufficient propensity of institutional investors toward equity allocations. The authors conclude that comprehensive measures are necessary to develop long-term savings mechanisms, enhance the accessibility of investment products for private investors, and foster long-term investment planning based on forecasting of asset returns.