Bellflower, CA is on the stock exchange map for being one of the upcoming elite investors cities in California

Weigh out the advantages and disadvantages in Investing in Stock Exchanges –as it can either ‘Make or Break Your Business’. Simply put, a stock is a legal ownership of a business. Corporations sometimes interchangeable call them “securities” because they are a type of financial security, or “equities” because they represent ownership (equity) in a business. The Local Records Office views investing in stock in our history as an effective way for individuals and families to accumulate capital and build wealth as well grow their passive income in Bellflower, CA. Though, most of those who invest have yet to understand the whole concept.

Jeremy Siegel is not convinced strong earnings will push stocks back into the record territory, and says that “It’s going to be flat to slightly upward tilting year as good earnings collide with what I think will be higher interest rates both by the Fed and the Treasury market,” he said on CNBC’s “Trading Nation.” “This market is going to struggle this year.” Siegel predicts the Federal Reserve’s plan to shrink billions in dollars of treasury holdings adding pressure to the market. And according to the latest CNBC Fed Survey, the Wall Street is expecting three rate hikes this year.

“These gains that people are talking about — 10 to 15 percent a year this year and maybe next year, I just don’t think they’re going to be realized,” Siegel said.

And with just under 10% of S&P 500 companies reporting first-quarter earnings, 71% of the reports are above estimates. These actual reported earnings per share are up 33% versus the first quarter in 2017.

Despite these encouraging numbers, Siegel has yet to believe that this year’s benefits from the corporate tax cut will wane.

“Firms are actually going to lose depreciation deductions in future years. So, it’s going to be great in 2018,” he said. “2019 — you’re going to have to have a growing economy to generate earnings gains. It’s not going to be anywhere near as easy as it was this year.”

Though Siegel wants to make one thing clear- He is not a bear.

“I’m not predicting a bear market. Valuations are still very attractive for long-term investors. We’re selling around 18 times this year’s earnings,” Siegel explained. “I wouldn’t sell out there.”

And although some argue that even with stocks experiencing a rough start this year, some stocks still have a chance to shine this year.

At the same time, it is important to be careful when choosing the stocks that have big upside because share prices can also crash very rapidly. So one pointer is to check the price movement over the last three months and be sure the shares are moving the right direction.

And with E*Trade enabling mobile access of trading stocks with a push of a button, today’s market has been defined by elevated volatility with having advanced market intelligence in the palm of your hand, described Christopher Larkin the senior vice president of trading product at E*TRADE, in a press release.

What is a Stock Exchange?

A stock exchange is a highly organized market, whereas listed securities are bought and sold under a certain code of rules and regulations. It is also known as a “security exchange” or a “security market” or a “share bazaar”. And it means a body of individuals, whether incorporated or not, constituted by the purpose of assisting, regulating or controlling the business with buying, selling and dealing in securities. Its purpose is to liquidate invested funds, making the securities easily transferable and mobilizes savings for productive purposes.

Advantages of Stock Exchange in a business

Long-term finance: as banks may not be willing to provide a long-term finance, companies needing such finance turn to the public, and invite people to lend money or take a share in their business for future profit.

While stock exchanges are allowing businesses to harness the power to grow and enhance their companies, the significant financial and regulatory costs associated with being listed on a stock exchange, benefits do outweigh the disadvantages.

Everyone wants to save or invest in one form or another. And the Stock Exchange allows a way to where money can be put to work. When a saver in shares needs his or her money back, he/she places the money in a different person who is seeking to invest in the Stock Exchange. Stock Exchanges are finding different solutions by providing contiguous and free market insecurities, with varying levels of degrees of success.

A 2012 National Small Business Association survey had revealed one of the major impediments to business growth was due to a lack of affordable capital. Companies listed on the stock exchange can quickly raise their affordable capital by issuing more shares for investors to purchase.

The Stock Exchange also gives investment opportunities for small savers which, in combinations with other institutions, patterns capital market in an economy. In a free economy, the stock exchange is the pivot of a money market. It provides an investment opportunity for small savers.

Companies listed on the stock exchange are also more recognizable and visible than any of their privately held counterparts. This increased visibility comes from being listed on an exchange and can help a company attract new clients and /or customers. It also draws press attention that may be more difficult and expensive for a company to draw on its own.

Higher quality employees are attracted to employers with name recognition and visibility. Stock exchanges overall help companies become household names and attract employers who are capable of making the company more profitable. And with the increased access to capital, companies are able to also better compensate these employees and helps keep them from moving to any of your competitors.

The Stock Exchange has no statutory authority, nor is a monopoly and has no legal powers over others. Members of the Stock Exchange also agree to abide by its rules as a condition to the membership as well the companies signing the listing agreement and /or general undertaking.

Disadvantages of Stock Exchange Securities

First, the risk of losing a great deal of money, companies can become bankrupt. And when this happens, you can lose all of your money.

Second, there are professional traders and huge hedge funds that take advantage of a greater knowledge, with greater speeds in exercising trades, and on account of their money, even have the ability to move markets in certain directions. And in many ways, is unjust.

Lastly, there are stocks very volatile. As an example, the leveraged ETFs often lose money in the long run, since they are short-term plays. When you do not have good timing or the knowledge, the outcomes can be very disastrous.

Jeff Martinez, B.S. Finance, and Asset Management at the California State University in Long Beach described the disadvantages of listing your company on more than one stock exchange – as when a company lists on various exchanges to get different types of investors it will create stability /appreciation but overall, foreign companies want to list in the USA to get access to our wide and diverse investor base. We have rules such as GAAP and other transparency or compliance rules that they may want in order to help them in achieving a new investor base with legitimacy. And while this doesn’t stop Chinese or other scams, it does help legitimate companies.