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Equity and Bond Market Returns Doc

Added on - 08 Dec 2020

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Comparison of StockMarkets
ContentsContents...........................................................................................................................................2INTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................1Comparison of Equity and Bond market returns of UK, USA and Australia........................1CONCLUSION................................................................................................................................4REFERENCES................................................................................................................................5
INTRODUCTIONStock Market is a very important concept in the field of finance; it is one of the most usedfinancial instruments. It is regarded as a asset class which consist of risk and thus the proportionof money that is being invested in other asset classes, the same proportion does not come intoequity markets. The current report will going to have a detailed discussion on the overall returnsthat has been generated by the equity as well as bond markets of 3 countries that is Australia, UKand USA (Fifka, 2013). This will help in getting a better view of the situation of stock markets inthese countries and the interests of investors within the stock market can be effectively laid downthrough this presentation.MAIN BODYComparison of Equity and Bond market returns of UK, USA and AustraliaStock MarketsEquity market of any nation is basically the mirror of economic situation of a country. Ifthe economic prospects as well as the policies of a country are quite good, then it will result intoa higher and effective stock market that will lead to better growth as well as development of thewhole financial instruments market like bond market as well as the insurance market thatprevails within the boundaries of a nation. Stock market is usually considered as a bit risky assetclass as compared to any other asset class like commodities or real estate, this is because themoney that is invested in equity is basically invested in businesses and thus the rate of return inequity is like return in any other business, which fluctuates with time. Thus, what is essential isto make sure that effective financial literacy program is conducted by developed countries likeAustralia, UK and USA in their respective countries in order to increase the penetration ofdomestic savings within the stock market (Yunus, Hansz and Kennedy, 2012).The rate with which each stock market grows varies a lot on the basis of various factorslike the growth rate of the country of which the stock market represents. The rate of profits thatthe businesses are making in the country and how the same is going to be reflected in theirquarterly as well as annual earrings plays a very crucial part in the overall growth and thedevelopment of the nation as well as the stock markets of that particular country. USA is thebiggest Stock market in the world with an approximate Market cap of around 20 Trillion$, afterthat it’s the Stock market of UK which is having a market cap of around 6.2 Trillion$ and thus1
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