Most investors understand that stock prices fluctuate almost every hour. The price drifts depend on many factors, which include market trends, inflation, supply and demand ratio, company valuation and a lot more. Even now, there are no theories that can cover all the factors that manipulate the share market and capture them in an equation. There are new factors that are coming in every day to make the matters of investment even more complicated. These factors include Bitcoin, Bitcoin alternatives and blockchain economy.
When experts compare the stock market prices across different national boundaries, they do not find any correlations between economic growth and the company share prices. It is because there are a few hidden factors that stay out of the radar during this process. For example – Australia has been a miracle economy in the last couple of years. It has shown the steadiest long-term economic growth. Australia did not suffer an economic recession.
This stock market is a winner’s domain
As a result, the ASX 200 Prices have been consistently high in the international markets as well. It has brought in considerable economic benefits to the country’s economy and the investors. All the current ASX 200 companies exclude the exchange-traded funds (ETFs) and the Listed Investment Companies (LIC). A committee from Standard & Poor’s (S&P) and ASX decide the company names that go on the top 200 each year. Rebalances occur in March, June, September and December on a quarterly basis. The top names always have IT, real estate and materials companies among them.
Right now, the ASX or the Australian Securities Exchange is among the top 15 exchange groups in the world. It has a daily turnover of a whopping $4.685 billion (Aus). Its market capitalisation is worth around $1.6 trillion (Aus). IT and technical services have always seen a steep growth in the ASX. Back in 2015 and 2016, technical services and information services revenues have shown 10% and 8% growth respectively.
The future is here!
In 2017, ASX announced the inclusion of blockchain technology in their stock transaction and monitoring infrastructure. The idea is to fine tune the legal aspects of dealing in Bitcoin and Bitcoin alternatives. The improvement in transaction infrastructure will also boost the update speed and reduce the cost of transactions within the system. The blockchain infrastructure is all set to replace the current CHESS (Clearing House Electronic Subregister System), which is somewhat cumbersome, slow and prone to human errors.
The final takeaway
The best way to understand a market, predict the stock prices and make the buy-sell decisions is to follow the history of a company or share. The past trends always show the way to future decision making. Modern technology allows many tools that can assess the current market prices, factor in the parameters that govern the rates and determine the future trends with near-accuracy. Trading in the finance market has become a lot easier thanks to the new tools, but that can never replace the need for astute record keeping and information updating.