Got a tricky question? Receive an answer from students like you! Try us!

Investment opportunities and risks in stock markets: A comparison between emerging and developed economies - Dissertation Example

Only on StudentShare
Author : whaley

Summary

The researcher of this descriptive dissertation mostly focuses on the discussion of the topic of investment opportunities and risks in stock markets and makes a profound and analytical comparison between emerging and developed economies…

Extract of sample
Investment opportunities and risks in stock markets: A comparison between emerging and developed economies

For over two decades the emerging economies’ markets have generated handsome returns for investors and thus created exciting investment opportunities globally. A careful analysis reveals that the growth of developing economies such as Latin America, Asia, and Eastern Europe began to grow at faster rates compared to developed economies. Some of the major causes for high growth may be attributed to trade liberalisation measures, new economic reforms, adherence to global trade pacts, and opening the door for Western investment. Meanwhile, increased urbanisation and escalating middle class incomes created a new class of a new generation of consumers that have very strong demand for infrastructure developments and consumer goods to support their new lifestyles. Thus, as a result of these significant shifts in market developments, investors were able to enjoy exceptional returns from their investment. Hence, the emerging markets have provided significant investment opportunities for investors during the past decade or so – whether in fixed income securities, currency market, or equity investment.
An investor will seek higher returns in the form of risk premium for taking higher risks of investing for the long run in emerging markets. These markets are expected to benefit from faster economic growth compared to the developed markets in the longer time horizon. This means that a considerable portion of faster economic growth should transform into higher equity market returns and corporate earnings. ...
Download paper

Related Essays

How much volatility is the Saudi Arabian petrochemical industry exposed to
Saudi Arabia is intrinsically dependent upon petroleum and petrochemical industry for its revenues and income. The nation’s huge oil reserves have assisted it in getting developed as one of the largest producers and exporters of petroleum and petrochemical goods. Precisely, the nation accounts for 20 percent of global petroleum reserves in the world and exports US$ 157.41 billion worth of the fuel. Importance of the sector behind the development of the nation could be well perceived from the fact that it contributes around 75 percent to government budget, 45 percent to the GDP and…
84 pages (21084 words)
Analysis of Witan Pacific Investment Trust Plc- Fund Management
Witan Pacific is an investment trust that was established in 1907 as General Investors & Trustees Limited (GIT). The company then used to invest in a diverse range of assets. Following the 1929 market crash, the company shifted from equities to Treasury Bills, cash and British Government Securities. GIT merged with City and Gracechurch Investment Trust in 1975. GIT was renamed F&C Pacific Investment Trust in 1984. In 2005 it adopted a multi-manager approach where Witan Investment Services was entrusted with management of the operations and Aberdeen and Nomura became the investment managers of…
12 pages (3012 words)
The Causality Relation between the Kazakhstan Stock Market and the US Dollar, the Euro and the Russian Ruble.
The relation between the Kazakhstan tenge and other currencies is examined by statistical time series analysis. The relationship of exchange rates over a specific period of time is studied based upon bivariate and multivariate variables. Currency has continuously evolved as the domestic and international vehicle for trade. This paper will define and discuss the history of the causality relation between the Kazakhstan Stock Market and the tenge, and the US Dollar, the Euro, and the Russian Ruble. The research includes a quantitative analysis by using several statistical methods to support the…
80 pages (20080 words)
Aqua Resources To List On London Stock Exchange Research Project
In a quest to diversify its portfolio, Aqua resources limited made several investments in subsidiaries such as Aqua Resources (In-Pipe) Holdings Limited, Aqua Resources Asia Holdings Limited, an exempt company incorporated in the Cayman Islands formed in October 2008 and Cooperative Aqua Netherlands Holdings UA, a Dutch co-operative company formed on 22 March 2010. In the company’s short life at the London Stock Exchange, the most significant decision was the tender offer toJPMorgan Private Equity Limited where the company sold out its ordinary shares to 29.9%. This resulted in less than 25%…
25 pages (6275 words)
Investment opportunities and risks in stock markets
With the EPFs emerging as a vital source of capital inflow for the developing countries, an array of issues arises regarding this pattern of investment. It is of prime importance to understand the diversification benefits accruing to an investor from investing in the developing countries and the returns to stocks of these emerging markets. Investors and researchers are concerned about the level of integration of these markets with the financial markets of the industrially advanced countries. Several research works have been conducted in the past to investigate about the process of integration…
14 pages (3514 words)
Stock Investment Analysis
By careful analysis of the YTD returns it can also be observed that the short term yields for both the index as well as the FLCSX is higher than the long term yields. The yield differential between the 1 year return and 10 year return for FLCSX is 11.02% whereas the same is 9.9% for S&P 500. This implies that for the same time horizon, when the YTD returns of FLCSX is compared to that of S&P 500, the yield of FLCSX is more than S&P 500 index. Thus, while the FLCSX has yielded superior returns in long-term, the rate of fall in return is lower for S&P 500 implying that the later is less volatile…
4 pages (1004 words)
Stock Investment Analysis
What each and every investment requires is to perform well and fetch good returns. This is made possible when the business or investment is able to consistently build and maintain a long term growth on capital. The FLCSX fund tries to meet this general requirement through the investment in large capitalization stocks across the world (Vishwanath, & Krishnamurti, 2009). These large capitalization companies are the companies that are firmly established and have a high return on their capital. The FLCSX fund maintains a massive 80% of its investments in these kinds of companies (Elton, 2010). In…
4 pages (1004 words)