Question

1.3 Examine the impact
economic and political events
have on financial markets and
investment

Answer 1

   Financial markets are place where people trade financial instruments and derivatives and the exchange of financial items are also facilitated. In financial market there will be transaction of securities and derivatives. Securities includes shares and bonds. Financial markets are highly volatile and a small impact on the economy will affect the financial market and as our investments. These are highly related and interdependent.

Investing is an important thing and proper investments in different portfolios will be beneficial for the investor. So it is very important to make investment decisions. There are so many factors which will affect our investment. So it is very important to consider these factors. Then only we can make som profit from our investment. Goverment decisions and political factors will affect the financial market. Economical factors also affect financial market. What are these problems?

Market will fluctuate by different news in the economy. New government policies, economic decisions are also affect the market. Natural calamities, war and other pandemics are also reason for financial market fluctuation. Politics is another important factor. All political decisions are directly make an impact in the global economy actually. International trade will also affects. So definitely it will affect financial market. Political factors include taxation policy, environment law, political movements etc. So these factors will affect our investments. Policy changes, environmental factors can make many differences in market.

These indicates that we should be very careful while making investment. Proper portfolios should be considered. Because all of these are interconnected and small changes in these factors will affect the whole market. For investors they should follow the above said factors then only they can make good investment.

ThankYou....