Finance – Annuities

Finance – Annuities

Systematic risk evaluates the probability and extent of negative consequences to the larger body. For example, the government has a record of intervening in the event of a probable bank failure; the government’s larger concern is the negative impact on bank customers. Some call this a government bail-out.

Discuss the effect on stock market investor confidence should bank customers, individuals and businesses alike, lose access to savings and undergo a loss of future purchasing power due to a bank failure.

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The stock market refers to the market in which shares of publicly held companies are given out as well as traded either via exchanges or markets, For example, business like Facebook. When the economy is doing better, the publicly traded businesses will do better; this, in turn, indicates or signals to a great stock market (Bondt & Thaler, 1985).

(375 words)