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পড়াশুনা (Study)

Financial Market; The Keynotes You Need to Know

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If you know about Financial System, you may already know the financial market. Either you can learn about the financial systems by clicking here.

Financial market; Yes, it is just another market. We know about the regular market, there are sellers and buyers along with goods or services. Sellers are trying to sell their goods or services on the other side buyers are trying to buy them.

Unlink those regular market financial markets represents where the financial assets or financial instruments are being traded.

Now let’s find it out what are the financial instruments or financial assets. The most common financial assets are; stocks, bonds, mutual funds, certificates of deposit, and so on.

The financial market can be classified into the following markets;

  1. Capital Markets; consists of Debt market and Equity Markets.

2. Money Markets; refers to short-term funding. The market deals with short-term loans or deposits. Like as; call money ( Intra bank cash borrowing for short-term in many countries), Certificates of Deposit (CDs), Commercial Paper, Banker’s Acceptances, Repos, T-bills.

3. Futures Markets; Buy or sell contracts on a specific future date for commodities, currency, or securities.

4. Commodity Markets; Raw materials like oil are traded in this market.

5. Derivatives Markets;

6. Insurance Markets.

7. Foreign Exchange Markets

 

 

পড়াশুনা (Study)

Why people invest? Is investment make them happy?

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Well! you are here to know why people invest? Yes, that is the same reason why you reading this line. That is getting a benefit or expecting benefit from some sort of activity. Maybe reading a blog or maybe eating a pizza.

According to Finance or Accounting terms “expecting a larger amount in future by doing some activities from the current.”

Why we expect a higher return in future?  One word can define all; “Inflation“.

We may recall the time value of money. Today One Dollar is more powerful than tomorrow. It defines today anyone can purchase more commodities by One Dollar than tomorrow.

People give us $ 100 today expect to consume $ 105 or more of goods and service in future.

“What is Investment?”

The current commitment of these saving (whose consumption is lower than income) for a period of time to derive a rate of return that compensates for the time involved, the expected rate of inflation, and the uncertainty.

Common reasons for investment;

  1. Secure the future.
  2. Grow the money.
  3. To earn.
  4. For getting a tax benefit.
  5. An investor can help others.
  6. To start a business.
  7. To reach financial goals.
  8. Making a difference.

Why should I invest in stocks?

This is another common questions I found mostly from my friends and family. Well those are the most reasons you should invest in stocks;

  • The potential to earn higher returns than alternatives like bank deposits, gold, and government bonds.
  • Stocks have the ability to protect your wealth from inflation, as the returns often significantly outpace the rate of inflation.
  • Anyone can earn regular passive income from dividends (A companies distributed profits called dividends).
  • The ability to own a tiny slice of a company whose products or services you love. Think about it the bank in which you depositing money, you own a slice of that bank perhaps make you feel better.
  • The ease of buying and selling, which makes stocks a more liquid investment compared to other options like houses and other fixed assets.
  • It is easy to diversify your investment in stocks from real estate to tech companies as per your wish and like.
  • Most I love about stock is, I can invest as much low as I can The ability to start small.