The effect of share market and share market advisory services on country’s economy

The article discuses about how the share market is linked with economy and how various share market factors affect the country’s economy.

Share market and economy of the company both are interlinked and changes in one can show impact on the other.  They both are interlinked and have a great impact on each other but to understand it, we need to understand first what stocks are. Stocks are the ownership interest of any company.

The stocks have been raised by the company to increase the capital of the company.  Thus, it affects the company’s total economic worth.  Various businesses all together affect the country’s economy so in that way stock market can directly affect the country’s economy.

There are many factors that affect the stock market too and even the effect of stock market on economy is in many folds thus it always helps the individual to get share market advisory services if investing in stocks.

Stock market can effect on pension schemes

Anyone who has enrolled with any private or government pension schemes may get affected by stock market but it affects indirectly. Pension funds invest in the stock market so any ups and downs in the stock market can affect the pension funds. If the market breaks and goes down and stays down for the longer period of time then it can lower down the pension value also.

If the share market stays down for very long period then it can affect the future pensioners also. Pension funds will not be able to get the returns and that way it will affect. Though, short term movements do not affect much.  So, this can affect the pensioners who are the householders and they will get lower pensions so in turn they will lower down other expenses.

Stock market can affect the wealth of people

Share market directly affects the wealth of people of any country. If share market crashes down and if people come across monetary loss then they will not spend money on other expenses.  If people earn money through share market then they will spend money on other things and it will bring the economy of the country higher through lots of buying and selling. This wealth effect is seen more in the real estate market.

Effects of other investment schemes

People have natural tendency to shuffle their money between different investment schemes. When market goes down they rush to the other one that gives higher returns.  So, when the share market falls it creates high in the other investment funds like bonds and mutual funds. Even it can give rise in the investment in gold.

Share market and global economy

What happens in the country’s economy gets reflected in the share market.  Global slowdown and recession can affect the country’s economy and also the share market. Sometimes it also happens that stock market does not get affected much by global slowdown and works as a separate unit.  In India, all the stock exchanges work under regulatory body and SEBI approved share market advisor can always be a best choice to get share market advice.

Conclusion

Share market affects the global and national economy as it has major share and liquidity in any country’s net worth.

Author Bio:

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