What is an unlisted share?
An unlisted share is a share in a company that has not been admitted to trading on a regulated market (an exchange) or a multilateral trading facility. The vast majority of Swedish limited companies are unlisted — everything from newly started ventures to large family-controlled groups.
How it differs from a listed share
The difference lies not in the share itself but in how it is traded. A listed share has a continuous market price and can be sold whenever the market is open. An unlisted share has no continuous pricing: its value is instead set in individual transactions, in a financing round or through a company valuation. Ownership is recorded in the company's share register rather than in a depository account at a broker.
What to keep in mind
Lower liquidity is the most important difference — there is not always a buyer when you want to sell, which is also why unlisted shares are often valued with a liquidity discount. The articles of association may also restrict who you are allowed to sell to, through a right of first refusal or a redemption clause. Information about the company is more limited: the annual report is often the only public source.
Tax and custody
For Swedish tax purposes, five sixths of a capital gain on unlisted shares is taxable, giving an effective rate of 25 percent on non-qualifying holdings. Unlisted shares generally may not be held in an investment savings account.