Questions tagged [stock-market]
Markets in which ownership stakes of firms (e.g. stocks/shares) can be traded.
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How does stock market drop affect the economy if it doesn't affect the corporations?
Sorry if it's a basic question.
Suppose corporation ABC went through public offering many years ago. ABC retained 30% of the shares, and 70% are being traded. The very initial offering, ABC made ...
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1answer
39 views
what would be an efficient investment when central banks have massive qe?
Recently the central bank said in a statement on its website. “Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift ...
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0answers
10 views
Do large- and mid-caps try to shun low share prices?
As NASDAQ and NYSE stocks must be priced at least $1 per share, it feels intuitive and doubtless that large- and mid-caps fancy their share prices to outstrip and remain well over \$1. But what ...
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2answers
63 views
+100
What mechanisms are at work when the market falls dramatically one day and then rises just as dramatically the next?
We've seen this scenario several times over the past few weeks: The major stock market indexes will plummet one day and then rise dramatically (though perhaps not to the previous days starting price) ...
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15 views
Auction markets vs dealership markets
By refering to centralized markets, we usually have in mind underlying markets, such as stock markets and for instance the NYSE. Usually, me make a discrimination between the markets in the sense that ...
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1answer
36 views
Why does the stock market tend to grow over time
At its most basic, the value of a stock depends on how much people are willing to pay an entity that already owns the stock to transfer ownership. The question is, why does the amount people are ...
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2answers
51 views
How can I estimate the disconnect between book value and market capitalisation?
There are several questions on Stack Exchange as to what difference the stock price makes to a company after its IPO. Surely, management cares, it is important to be credible to trading partners, etc.
...
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1answer
28 views
Why does Samuelson say common stocks are better than bonds and preferred stocks during inflation?
I’m reading the first edition of Paul Samuelson’s Economics (1948). In Chapter 6, “Business Organization and Income,” after describing bonds, preferred stocks, and common stocks, he writes:
To test ...
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1answer
19 views
Shouldn't national Stock Indices proportional to GDP of the country?
I was looking at Japan: Japan's GDP trajectory and Nikkei 225.
It seems from 2011 - 2015 the GDP contracted but the Nikkei has gone up. Would there be a good explanation for this ?
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1answer
28 views
What does it mean for a firm to have a 0.95% dividend?
Here's an Apple's dividend:
What does this 0.95% mean? Is it 0.95% of share capital? If not, what does it mean?
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0answers
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List of stock and bond indexes for countries
I am doing some master`s degree research and looking for the list of stock/bond indexes for developed and developing countries. So the excel-file I should gather in the end will look like this:
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1answer
30 views
What's the special notation?
I'm studying "ALGORITHMIC AND HIGH-FREQUENCY TRADING". Page 249 of it tries to find a formula for $h(t,q)$. First, it supposes $h(t,q) = \bar\kappa log \space\omega(q,t)$ then let $\omega(t)=[\omega(...
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Can “invisible” investing by the Chinese govt. create bubbles in the stock market?
In this link, they claim that the Chinese govt. secretly pumps money into the market as soon the market crashed due to Corona Virus. How is this different, in terms of long-term impact, from ...
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1answer
80 views
Why does the US government not invest in the stock market?
We often talk about the huge public debt of the US government. Why does it not invest in the stock market (at least in index funds) instead of issuing debt? Can they not reduce the debt that way?
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1answer
22 views
What happens to interest rates when they are already at (near) zero and the stock market crashes?
Let's say the global stock market crashes in the coming months (it's currently at an all time high in the western world). What happens to interest rates?
"Usually", as I understand from my absolute ...
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0answers
79 views
How does denominator effect works?
People say that when overall market falls,
Prices of real estate rise because of denominator effect.
But what is the logic behind it ?
My understanding of denominator effect is ---denominator is ...
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0answers
17 views
Did Johnson and Johnson really pay a 25% quarterly dividend in 1978?
I looked through some of the old Dow Jones stocks for a project I'm working on and found some inconsistency with JNJ stocks.
Basicly for a share price of $1.66 they appeared to pay \$0.42 in quartely ...
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13 views
How to quantify tax liability of unrealized cap gains in mutual fund
Consider an S&P 500 mutual fund. At any moment the holdings of the fund include unrealized cap gains that should eventually generate tax liability. Thus, for a potential investor, the fair value ...
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0answers
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At what rate can a multi-billionaire liquidate his assets without significantly affecting the stock price?
Let's consider three different billionaires: Jeff Bezos, Bill Gates and Warren Buffett. Now let's say the three of them (at different times) decided that they want to liquidate all their assets and ...
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0answers
26 views
Stock price and exchange rate is correlation, but VAR model order is zero
It is well known that Japanese stock price and exchange rate(USD/JPY) is correlation, So I built a VAR model in python about stock data(Tokyo stock price index) and exchange rate(USD/JPY) and I fitted ...
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2answers
91 views
EMH: Difference between market price and fundamental value?
I am confused by the relation between stocks market prices and fundamental (or intrinsic) values stated by Efficient Market Hypothesis. How these deviates regarding to efficient market theory or are ...
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2answers
37 views
ROI and stock rates
I'm an engineer with minimal to zero knowledge about economical topics, please be patient with me if the following question makes no sense or is too basic ...
Currently I'm working through the "...
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1answer
33 views
Banks and Stock Market in Germany
My question is:
**
Why does Germany have such a small stock market, but very large
powerful banks?
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0answers
9 views
Effects of Passive/Active market allocations on liquidity and Bid/Ask spread
In The Paradox of Active Management, the author argues that in the event of a shift from Active to Passive management, Bid/Ask spreads and market liquidity will be affected,
In our scenario, the ...
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0answers
28 views
Get Annualized return from a time series of daily returns
I have a time series of data which has daily returns over 15-year time period.
I understand that you get multi-period simple return using the following formula.
$$1 + R_{t}(k) = \prod_{j=0}^{k-1}(1 +...
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0answers
13 views
Volatility measure in Diebold-Yilmaz connectedness approach
I am trying to create Diebold-Yilmaz connectedness table for returns and volatilities. When I do it for returns everything works properly (I can reproduce their work actually) but for volatilities I ...
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0answers
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List of important business and economic news events between 1850 and 1930?
I'm collecting data on important business and economic news dates in the late 19th to early 20th century. The only list I found is this: https://www.encyclopedia.com/history/news-wires-white-papers-...
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1answer
40 views
Fall in share due to litigation
Recently, I read a news article stating
Indiabulls Housing Finance shares plunges on reports of litigation against company
Why do shares plunge when company finds itself in a litigation process? ...
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0answers
26 views
Which assets beat the injection of money and why?
Suppose a world in which every year $1.03 ^ Y$ liquidity is injected.
Which assets could perform better than 3% per year?
Growth forecasts for these?
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1answer
31 views
Why does equity have historically poor performance after rate cuts?
I am struggling to understand why equity markets seem to suffer shortly after fed rate cuts. Here is a rather telling chart:
Question
Assuming not some kind of spurious relationship, what's the ...
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3answers
146 views
Does stock picking work?
Does stock picking work? Why/why not? What does the research say about it?
(I was expecting that this should already have been asked and looked quite extensively for such a question but couldn't find ...
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1answer
35 views
How to calculate cost of equity?
So i have this question on leverage and cost of capital:
Leverage and the cost of capital Gamma Airlines has an asset beta of 1.5. The risk-free interest rate is 6%, and the market risk premium is 8%....
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1answer
77 views
How to calculate standard deviation of a portfolio?
So i have this information:
Suppose that 60% of your portfolio is invested in Johnson & Johnson (JNJ) and the remainder is invested in Ford. You expect that over the coming year JNJ will give a ...
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0answers
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Was magnitude of concerns about market correction/crashes prior to previous crashes similar in magnitude to today's concerns?
I am still new to learning about stock markets, and I have more of a history question. Right now, I hear a lot of people express their concerns of a market slow down within the next 1-3 years, or ...
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0answers
17 views
Stock market's obsession with growth of all companies?
I understand the stock market is a useful place to gain capital which allows further growth of a company. But it seems to me that even companies that have been on the stock market a while, appear to ...
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0answers
14 views
Stock Price vs Stock Return Autocorrelation
There are a lot of paper that claim stocks follow a random walk and therefore not predictable. A basis for this statements often times a autocorrelation test of the returns. However, what if there is ...
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0answers
19 views
Decomposition of stock index movements
I want to decompose stock index movements. I know the estimated 12 months earnings growth rate ($g_1$), estimated long run earnings growth rate ($g_2$) and the index value.
I am about to use two-...
0
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1answer
24 views
Open offer made by companies to take over [closed]
What is open offer in simple terms? What is its meaning in cases of taking over the major stakes in other company?
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0answers
10 views
Commonly used indicators for currency pair strength?
I am attempting to write a program in Python that monitors a single currency pair, GPB/NZD to be specific. My main focus will be to run constant calculations every 2 to 3 minutes in order to give ...
4
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3answers
81 views
Why does a company want the value of its stocks to be as high as possible?
My professor claims that a company want the value of its stocks will be as high as possible. Why should the company care? The company "minds its own business" and make its money. Why should it cares ...
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1answer
47 views
Is this lottery like stock market? [closed]
Consider the following imaginary lottery (motivated by
Massachusetts' Cash WinFall):
Ticket money obtained in the previous draw are given to the participants of the next draw proportionally to the ...
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0answers
17 views
Where to find a list of marketplaces (NYSE,LSE) and the financial products they offer?
I'm looking for a list (csv/json/api...) of all marketplaces (New York Stock Exchange...) and the financial products that are offered on those market places.
Preferrably worlwide but US and EU will ...
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0answers
20 views
Average Return for Commodity
Suppose I have a function of a varying values represented by randomness. A stock or price of a commodity would be a good example.
What is the average return for that stock on any given interval of ...
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0answers
37 views
Can a government invest in public companies so their dividends can finance the government
Is it possible that a country could use the money in its sovereign wealth fund to invest in different country's Stock Market and use the dividends to finance its government thus increasing spending ...
0
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1answer
34 views
How to find data about earning per share of S&P 500
I am working on a small project regarding PE ratio of SP500,for which I need historic earning per share data of SP500. I searched finance yahoo, but it has only prices data. Could anyone tell me the ...
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1answer
65 views
How time zones affects causality?
Considering that markets open in different time zones, in general the opening and closing times are different.
I suppose that a stock market opening later (in the same day) receive information on the ...
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1answer
59 views
Is this market monopoly or duopoly?
Could you help me to identify monopoly, because I got confused. There is a company with market share of 54 %. The second one has market share of 21 %.
Can this market be characterized as monopoly or ...
0
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1answer
24 views
Is it possible for shareholders to get a companies assets in place of currency?
To my knowledge being a shareholder is owning a portion of a company. Then by that logic shouldn't a shareholder be able to request a companies assets instead of money? As an example, if I own 100 ...
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1answer
44 views
log returns in finance
Why are log returns used in finance? For example to calculate a stocks performance. There are a lot of articles on that topic yet I don't find them very helpful. Could somebody please explain step by ...
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2answers
151 views
Why does firing employees appear to increase the share price of a company?
The last case is GM in the USA. I fail to understand why does this happen. I understand that laying off jobs means higher dividend for the share holder and thus higher stock prices but in the long run ...
