feds digital currency- Top Knowledge

1. The economic barometer function of the stock market icon2. The relationship between the market base of derivative financial products and the stock market.The stock market also has the function of resource allocation. The rising stock market can guide the flow of funds to enterprises with good efficiency and development potential, and realize the optimal allocation of resources. When the stock price does not rise, the flow of funds may be stagnant or disorderly, and those high-quality enterprises that should have been supported by funds may be ignored, resulting in waste of resources and inefficient allocation.

For investors, the stock market provides a way to directly participate in enterprise growth and profit sharing. When buying stocks, investors actually become shareholders of the enterprise and have the right to share the dividend icon and capital appreciation of the enterprise. If the stock market does not rise, investors' income will not be guaranteed, which will weaken investors' confidence in the whole financial market.The stock market also has the function of resource allocation. The rising stock market can guide the flow of funds to enterprises with good efficiency and development potential, and realize the optimal allocation of resources. When the stock price does not rise, the flow of funds may be stagnant or disorderly, and those high-quality enterprises that should have been supported by funds may be ignored, resulting in waste of resources and inefficient allocation.The stock market is an important channel for enterprises to raise funds. By issuing stocks, enterprises can gather idle funds in society for expanding production and developing new technologies. For example, in the early development stage, Tesla icon invested a lot of money in the research and development of electric vehicle technology and the construction of production base through financing in the stock market. The growth of a large number of enterprises depends on the capital supply of the stock market. If the stock market does not rise, the financing ability of enterprises will be limited, and new investment projects may not be started, which will affect the innovation and development of the whole economy.

Summary: The stock capital market occupies a fundamental position in the financial system. It is not only a barometer of macro-economy, but also has important functions of capital aggregation and resource allocation. Other derivative financial products exist and develop on the basis of the stock market. When the stocks in the stock capital market do not rise, derivative financial products are like rootless trees, lacking the basis of value change, the trading volume decreases, the risk is amplified, and the meaning of existence is almost lost, which is equivalent to zero. This also reminds us that while paying attention to derivative financial products, we can't ignore the cornerstone and root of the stock capital market.Derivative financial products, such as futures, option icon, funds, insurance, etc., are financial products derived from basic assets such as stocks and bonds. Their value is derived from the price changes of the underlying assets. For example, stock option is a derivative product based on stock, and its value depends on the price fluctuation, maturity time, volatility and other factors of the underlying stock. If the stock market does not rise and the stock price lacks fluctuation, then the value of stock options will be difficult to be reflected. Moreover, derivative financial products themselves have high risks, and their price changes are often more violent than the basic assets. When the stock market does not rise, the high-risk characteristics of derivative financial products will be amplified, and investors may suffer huge losses.2. The function of capital accumulation and resource allocation in the stock market.