Development of Capital Markets in the Caribbean

Are Caribbean Capital Markets Developed?

This paper takes a slender look at the state of development of the bully markets of the Caribbean, identifying mainstay issues and challenges impacting on the development, and an conjure of some recommendations on the way forward.

WHAT IS A CAPITAL MARKET & ITS ROLE?

Capital markets contribute be defined as a market for the consequence and trading of financial instruments that have long term maturities. These instruments ar primarily stocks, bonds and their derivatives used to raise funds on behalf of corporations and governments which offer an alternative to traditional bank financing. 

Capital Markets play a crucial role in the development and growth of an economy. An economical chapiter market channels funds to the most economic efficient basket of goods and services in that economy. It increases a plains GDP by giving access to capital to produce goods and services. They help to diversify an economy. They lower the cost of capital and at that placefore makes more projects viable. Investors benefit by earning a render on their investment.





STATE OF DEVELOPMENT OF CAPITAL MARKETS IN THE CARIBBEAN AND CHALLENGES THEY FACE
In the Caribbean, it is generally accepted that the capital markets atomic number 18 underdeveloped and that there is much to be done to improve their efficiency. Depth and liquid state of the market is measured by the ability to buy/ bewray securities with minimal loss of value. A large number of impulsive buyers and sellers assist in this. Liquidity will ensure that the bell of securities is a true representation of its market value.
Capital markets in the Caribbean are illiquid and do not comprise of many actively traded securities in the secondary market. Daily trading volumes in the Caribbean are insignificant, usually securities changing hands amongst a few institutional investors. Most investors hold their securities either to maturity or on a long term basis.
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