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Capital Market Characteristics you need to know before entering Stock Investments

Capital Market Characteristics you need to know before entering Stock Investments

Before investing in stocks, it is advisable to know the characteristics of the capital market, especially the stock capital market. The first feature, like the nature of other current asset forecasts, securities such as stocks is a liquid estimate because the market is ready to make any sale or purchase at any time.

The second feature is that both the seller and the buyer have the same opportunity to obtain sufficient information through various available information media. In order to obtain concrete and accurate information, it takes extra care and extra effort in seeking informsi to complete the decisions that will be made on our investment. Through this information, it can be interpreted the impact of information and events that are or will occur on the movement of stocks in the stock market. For example, the Bank of Asia declared a decrease in market interest rates. It will affect the value of the joint stock index on the exchange. The decline in interest rates, means that investments made by investors will not be as much as previously expected. They tend to seek greater investment returns, such as stocks that will probably yield more than double the interest in the bank. Such a thing will be more perceived by market participants in developed countries who are familiar with the capital market. In addition to developed countries, developing countries will also feel the impact of lower interest rates in the United States because many foreign investors who trade shares in developing countries such as Indonesia. With so many purchase requests, it will automatically raise the overall stock price index.

Best Profit Capital Market Place

The third feature in stock trading, the brokers will charge for the transaction that occurs either sales or purchase transactions with a minimal cost of 0.3% for stock purchase transactions and 0.4% for stock sales transactions. With minimal cost, it is expected not to become a burden for stockholders to sell and buy shares in a high enough frequency. Thus, stock trading can be empowered to encourage high turnover of funds in capital markets.

The last feature of the capital market is the price of following the growing information on the market. As the law of demand and supply in the economy, the higher the demand, resulting in an increase in the price of an object of the traded value. In the stock market, also applies the same for stock trading. When many investors make buying transactions, at that time there will be an increase in shares traded and indirectly raised the value of joint stocks.
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