DO STOCK

EXCHANGE
HAVE A
FUTURE?

Tanisha doshi

Roll- 111

sybfm
WHY DO STOCK MARKETS
EXIST?
Stock markets exist to serve the wider economy. It helps
individuals earn a profit on their income when they invest in
the stock market and allows firms to spread their risks and
receive large rewards. It also enables the government to
increase spending through the tax revenue they earn from
corporations that trade on the stock exchange. The
government uses the revenue to increase re-investment and
employment capacity.

The stock market plays an important role in the economy

of a country in terms of spending and investment.
Without stock markets, many countries would not be as
developed as they are. Alongside this, it has helped
individuals become wealthy and increases the overall
standard of living in many economies.
WHAT ARE THE BENEFITS
OF STOCK MARKET ?
1. Access to Capital
2. Enhanced Profile
3. Ability to Attract Better Employees
4. Increased Value
5. Ability to Maintain Control

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HOW STOCK EXCHANGE AFFECTS ECONOMY ?
The stock market and the
economy are in a lot of talk in
recent days. Seeing the market
indexes declined by over 30%
within a month, an obvious
question among people is to
understand how does the stock
market affects the economy.
In this article, we are going to
answer the same and discuss
the effect of rising or falling
stock market on the economy.
In addition, we’ll also answer
whether the stock market and
the economy are the same or
not. Let’s get started.
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 Stock market and Economy
are not the same

Contrary to popular belief, the

stock market and the economy are
two different things. The GDP of an
economy and the stock market
gains are incompatible, and, in
fact, there is little comparison
between the two. The major
reason for this discrepancy is the
difference in the size of the two
markets. The economy depends
on millions of factors that can have
both a positive and negative
impact, while the stock market is
only affected by one factor, the
supply and demand of stocks.

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PENETRATION LEVEL
INDIA PENETRATION LEVEL
While investing in stock markets has
become more popular in recent times,
overall penetration remains low only 2.78
crore Indians invest in the stock markets,
which is around 2% of the country’s
population. In comparison, over 50% of
Americans own stocks.
Even in neighbouring China, the
percentage of the population that invests
in the stock markets is 7%. India’s 2
percent figure indicates that there’s plenty
of headroom for India’s stock market
penetration to grow.
USA PENETRATION LEVEL
In 2020, 55% percent of adults in
the United States invested in the
stock market. This figure has
remained steady over the last few
years, and is still below the levels
before the Great Recession, when
it peaked in 2007 at 65 percent.
In USA stock market plays a very
important role it’s the economic
barometer
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WHAT WILL BE THE FUTURE OF THE INDIAN
STOCK MARKET ?
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THANK YOU!