Monday, July 18, 2011

A GDP Backed Stock Index

Countries with emerging markets, possessing a high GDP growth rate and expect to experience the same in foreseeable future, can introduce a stock directly linked to the GDP growth rate.
Countries like Brazil, India, China, Qatar, Paraguay can directly create a link between a certain percentage of GDP growth with the stock index value. This will make the said stock more predictable and a direct representation of the country's economy.

Reasoning behind this idea is, I was wondering if, instead of investing in Chinese markets or any other business opportunities there, I could invest in something that is directly linked with the growth of Chinese economy. Idea might seem strange and opposing to the current orthodox ways of setting different stock indices--having indirect links with phenomenon such as GDP, Inflation, Dollar Value--- But not directly linked stock. But as a country, the concern is to bring in investments, orthodox or un-orthodox is not the question to be asked.

This approach can be, specifically, used by countries like India, Brazil, Qatar, United Arab Emirates, whose GDP's are on the rise, and they are expecting growth in the foreseen future. There are so many investors who are inclined to invest in such countries but find it difficult to look for 'real' earning opportunities. These investors, including myself, would feel more secure in investing a country backed stock---Yes! a Country Backed Stock!! This way investors can get much secured returns on their investments, and can predict the returns in a better way than investing in any corporation of that country.

On the other hands these countries will have huge investments flowing in and this, in turn, again increase their GDPs if these investments are used properly.

Stocks may be linked with GDP itself, or GDP growth rate, but all technicalities once taken well care of, this NEW STOCK INDEX can generate greater returns for the good of both investors and the growing countries.
 

11 comments:

  1. That is so true. As an author and business man, I can relate to how you said "This will make the said stock more predictable and a direct representation of the country's economy". I hope more people discover your blog because you really know what you're talking about. Can't wait to read more from you!

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  2. Hi Daniel! Thanking you for the comment and agreeing to the idea. I will resume writing again, thanks for the encouragement. Mind sharing your work also? What kind of business you are into?

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  3. Fantastic goods from you man. we have understand your stuff previous to and you are just too excellent. we really like what you have acquired here, really like what you’re saying and the way in which you say it. You make it entertaining and you still care for to keep it wise. we cant wait to read much more from you. This is really a great site

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  4. @ All.. Appreciate your support and encouragement.. I was regularly writing but then stopped as I felt people were more interested in looking at money making blogs, and didn't like new ideas. But looking at your response, I feel there are still quite a few out there thinking the way I think.

    I will resume writing soon ... thanks again!

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  5. Jarral,

    I just stumbled across your site and really enjoyed what I found. I am the chief community activist over at FEED the BULL, http://www.feedthebull.com, and think that you would be a great addition to the site. We have just launched the new Personal Finance section and would like to have your posts on the site. You seem to have a great balance between investing and personal finance and the community would benefit by having you around. Check us out on Twitter or Facebook if you have any questions.

    Hope to see you and your content around!

    Ron Coleman
    http://www.feedthebull.com

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  6. Dear Jarral,
    I have found your blog, which I really like it. Enjoyed to read your posts, hope you will continue it.
    I was wondering if you would be interested in sharing your posts and ideas on Glipho? It's a quite new social publishing platform for bloggers, where you can collect to every social network accounts.

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  7. Hello all! thanks for liking my content. I've been away from writing but I plan to resume it again as I've settled down in Canada now.

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    Does operating a well-established blog such as yours take
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  9. Hi,In addition to a local sponsor, you will need to open a bank account with at leastBusiness setup in Qatar as part of your company formation in Qatar

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  10. Hi, I enjoy reading your site! Is it okay if I contact you through email? Please email me back.

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    harry.roger10 gmail.com

    ReplyDelete