Economy

Economy

INTRODUCTION:

GDP is gross domestic products means total value of goods and services produced within a country

There are various ways in which the GDP is measured.

            1. GDP nominal means GDP in dollars.  Usually its considered for ranking

            2. GDP PPP means GDP based on purchasing power parity definition.

                        PPP means relative value of goods and services as compared to other country.

LESSONS LEARNT:

1. Market Cap/GDP ratio determines how favourite Equity investment is that country.

Indian is lagging much behind.

2. GDP means production that mean business growth that means profit growth that means share price gain

We should see only International Monetory Fund website for reference

3. Market return is DOUBLE OF GDP RATE.

            If GDP rate is 6%

            Market shall deliver 12%

4. GDP is reflected in Index.

5. For investors important parameters are.

            1. GDP growth rate

            2. Inflation rate

            3. RBI repo rate

            4. Unemployment data.

 6.The Formula for the Stock Market Capitalization-to-GDP Ratio Is

            Market Capitalization to GDP=  SMC/GDP x100

            where:

            SMC=Stock Market Capitalization             GDP=Gross Domestic Product