Who benefits from the finacial markets?
By pringu
@pringu (151)
India
July 16, 2012 9:37am CST
Financial markets are beneficial for each and evry participant. Let me explain it how:
As an investor: you are having the leverage or opportunity to buy or sell shares or securities of several companies or corporates. In other words, the cash or the money you have invested in the market is 'liquid'. You could buy any number of shares at any point of time as well as you dispose off or sell the shares whenever you wish to. So, tats what 'liquidity' means.
As an issuer: you are having the leverage or opportunity to raise capital or cash from the stock market inorder to fund the business over a longer period of time. In other words, the supply of cash from the stock markets are unending until and unless the stock market exists.
As an intermediary or stock broker: you have the advantage of levying or imposing brokerages on every buy or sell order executed on the stock exchange. On a daily basis there are hundreds and thousands of transactions being made and the brokerages amounts for a handful amount of money for the stock brokers.
The above said are few of the participants in the financial markets. There are lots more like the foreign institutional investors, foreign direct investors etc. The idea here is to make clear how engaging in buying and selling of stocks is beneficial for each and every participant
3 responses
@AgentGulaman (3546)
• Philippines
17 Jul 12
Yeah, circulating cash through the stock market is awesome. It helps the economy by continuing inflows and outflows of hot money through investments. I never really thought that there is such at thing as this when I was young. If only I learned about it when I was younger I could have put in a lot chunk of my savings in there. Anyway, I still got a lot of years to go over and invest in the thrills of the stock market. Yes, every individual participating in the stock market has their roles to cover. Stock traders provide liquidity while market makers moves markets to better the circulation. Investors do have roles also of putting in stability for the securities and brokers of course helps maintain the market. I just hope a lot of my fellow countrymen engage in this great economic way of profiting. To be honest, I am now getting addicted to investing and trading.
@AgentGulaman (3546)
• Philippines
22 Jul 12
Since I started to learn about the stock market and eventually started investing in it, I really find a passion to further improve myself into using it as a means of profit. As you can see, I am not a good entrepreneur and business is most likely not my type of thing. I am an engineer and I have taken some electives regarding economics. So my skill really lean on analysis and research making the stock market a viable option for me to put my skills to the test and earn some money too.
@lampar (7584)
• United States
16 Jul 12
It is designed primarily for the benefit of big banks, large institutional investor and brokerage firms in wall street. The present regulation and rules in the financial market are too weak to benefit anyone else except the big players mention above.
@shahamed (92)
• Singapore
17 Jul 12
If someone has to profit, another has to loss
Whenever an individual investor makes money out of the stock market, it is money lost by another individual investor. You can benefit from the stock market, but experience, knowledge and luck plays a big part in your Profit and Loss.
@AgentGulaman (3546)
• Philippines
17 Jul 12
But still, even small traders, cooperatives and institutions do benefit from the stock markets. Even the Church is invested in the stock market for funds. Government social security systems and funds for citizens also invests in the financial markets making the benefits of it indirectly to the people.
@stealthy (8181)
• United States
16 Jul 12
Everyone should invest. I have made my living for over 20 years just with my own investments. I started investing early when I was working and lived frugally and saved over 20% of my income each year. So when I became unemployed, I had enough saved and invested to get my full income from that. I have done some buying and trading but more recently, I have tried to mostly concentrate on income investing by investing in high dividend stocks and bonds with some lower dividend but safer ones to provide a steady reliable income.