Research
                                                                                 Observing the Stock Market

            The New York Stock Exchange has hit all-time highs, and investors are wondering what will happen in the upcoming months. Will market continue to rise? Recently, the Dow Jones Industrial Average (DJI) hit 16,000 for the first time in market history. This is an exciting time in the world of finance and investment, but most people, young and old, have no idea how stocks work.

            The stock market has many functions. It provides incentive for business owners and equity owners. It also provides a look into human behavior. If it didn’t exist we would know a lot less about the limits of rationality. The stock market also allows the average person to make extra cash. (Chris Dillow 2013)

            One concern about the future of the market is fact that young people do not invest. “Gen Y lacks knowledge and resources to invest in the stock market. There are other options which entice this group to participate like unit trusts and bank investment products…” – Ng Chze How (AmInvestment Bank Bhd’s director for retail funds) They do not understand the potential for investing. The stock market operator has been under pressure lately due to retailer investors giving the cold shoulder to the local market. (Muhammed A.H. 2013)

            In the upcoming years, the market is expected to soar. The market has cycles, and it is expected to come soaring in 2018. After a market falls to lows, it is expected to make a large comeback within a 17 year period. “I think it’s very hard to come up with a persuasive case that equities will over the next 17 years perform anything like they’ve performed in the past 17.” – (Warren Buffet, Forbes Magazine) The last years of a bear market can be an excellent chance to build a position. (Tom Stevenson 2013)


References

Chris D. (2013). The market’s uses: Investors Chronicle

Muhammed A.H. (2013) Dearth of Young Investors. Kuala Lumpur, Malaysia. New Straits Times

Tom S. (2013). Why a bull market could come charging back. London, England. The Sunday Telegraph