Free Essays on Stock Market to Get Inspired & Learn by Example

Abstract

As capital markets continue to burgeon around the world, automation and technological improvements play a big role in proliferation of these markets as a conduit for economic growth. This paper thus investigates as if the technology is all good for the stock exchanges, or if it has some bad effects over the efficiency of the stock exchanges. Beginning the paper with a theoretical discussion and by introducing some real-life evidences both in favor as well as against the role of technology in the stock exchanges, the paper concludes with literature evidences where scholars by using different research methodology have Continue reading...

Introduction

The financial crisis of 2008 has ignited talks about the role securitization in the economy, which was once a latent subject. The recessionary impact felt in many countries during this period witnessed the collapse of banks, loans getting bad on large scale and owners of securitized securities taking a big hit. This leads to the debate on the effectiveness and limitations of the securitization process on the economic growth of a nation. The paper aims to discuss the role of securitization in the economy.
The paper is divided into five sections. The first section attempts to understand the meaning Continue reading...

Financial markets play a critical role in stable and efficient operation of economies of various countries by providing liquidity to various forms of securities. Owing to their nature of providing simple and instant marketability, these markets allow both sellers and potential buyers of a variety of securities to interact openly and freely. Through the existing regulations in financial markets, efficiencies in several aspects of its operations can be achieved. In addition, these markets help in the determination of the various risks and rewards of these securities thereby helping in effective and fair pricing of these securities (Burke & Litwin, 1992). Continue reading...

Financial markets play a critical role in the operation of economies of various countries owing to the nature of these markets to provide liquidity to various forms of securities. The markets allow both buyers and potential buyers of these securities to interact freely. Through the existing regulations in these markets, efficiency in operations is achieved In addition, these markets helps in the determination of the various costs of these securities thereby helping in effectively pricing these securities (Burke & Litwin, 1992). In the United States, these markets have played key role in improving the operations of the economy owing to Continue reading...

Introduction

Credit rating is the assessment of the creditworthiness of debt instruments based on credit rating agencies’ assumptions, analytical models, and expectations. It reflects the agency’s subjective judgment of the issuer’s management and business. In that respect and given that modern business and finance world is subject to numerous risk factors, rating agencies are becoming crucial players in the capital and financial markets. That owes to their ability to analyze the bulk and complex information necessary to provide a judgment on instruments or business risk. In that view, this discussion seeks to demonstrate that rating agencies can help Continue reading...

Can we beat the stock market?

Can an individual investor beat the market?
Before providing an answer to the above question, let us discuss basic financial theory that has ruled the financial community over decades now, Efficient Market Hypothesis (EMH). EMH is indisputably a widely recognized financial theory that states that stock markets are efficient and all the stocks are fairly valued, thus making it impossible for the investors to purchase undervalued stock or sell overvalued stocks. Accordingly, no investor can outperform the market through expert stock selection. Ironically, while many financial pundits believe that markets are efficient and EMH do hold, we have investors Continue reading...

Value Investing

Introduction:
In the business world knowing the essentials of investment shall lead to sure success. Evidently, the way the world’s economy has been changing was into a platform that would encourage even the common people to invest. The world’s economy has grown much bigger in the 20th century and more accessible than ever with the existence of the worldwide web. But seemingly targeting the market without prior knowledge would be going into a battle without ammunitions. And to have a better approach in value investing most especially in stocks, the three lessons discussed in this paper will Continue reading...

Introduction

Organizations conduct monthly, quarter or annual measures on the financial status in order to determine the path taken in terms of sales and profits. Walmart, one of the world’s best performing companies, suffers from the stock market fluctuation. The financial report released by Walmart in 2015 shows that the company has experienced 6 quarters without any significant growth. The company continues to invest in key business areas such as e-commerce and mobile sector in order to achieve more business improvement opportunities (McDaniel, 2014). Positive growth was experienced by Walmart competitors during the same period leading to the following Continue reading...

Adding alpha returns of all active investors while ignoring transaction costs such as fees and expenses does not guarantee positive returns. For active investors to realize positive returns, the market must be favorable as well as satisfy several factors. First, active investors should carefully select investment opportunities that lie above the market line. The market line provides a benchmark for evaluating the performance of an investment (Foster, 2010). The probability of getting positive returns also depends on chance. Therefore, an active investor may project that a particular investment will deliver positive returns but, selection strategies fail to deliver the Continue reading...

ANALYSIS ON COLLATERALIZED LOAN OBLIGATIONS AND ITS INFLUENCE ON THE ECONOMY

Financial institutions offer securities that are backed by a pool of debts mostly those that have low-interest rates. These financial products are called collateralized loan obligations (CLO). Collateralized loan obligations play an important role in influencing the economy. This is through the buying and selling of structured debt instruments by the investment banks and other financial institutions. The CLOs are popular since they can meet the desires of different investors in the economy. Both the conservative and high-risk investors are able to find the suitable debt for them since the tranches are tailored to meet their needs (Hunt 2002). Continue reading...