Black Monday 21st January 2008 ---- PLEASE HELP ME!!?

Question

What is the cost to individual investors of market fluctuation

&

What is a benefit of a share market to the economy

:)

Answer 1

This sounds like a homework question.

(1) I would argue that there is no cost of market fluctuation unless you are leveraged long or short and cannot afford to be leveraged, hence subject to margin calls.

The only time when one has a realized gain or loss is when one sells at a gain or loss.

The US stock market has fluctuated for over 200 years (since 1792). History has shown that investing in quality stocks has been a good idea.

(2)  The phrase, "share market" should be addressed as "market share." As to how owning shares in stocks has a benefit to the economy? Huge. America was largely built on capital formation via stock in public and private markets.