Overcoming the Barriers to Long-term Thinking in Financial Markets
Organisation: Forum for the Future
Publish Date: 2011
Country: Spain
Sector: Economic
Method: Foresight
Theme: Futures
Type: Report
Language: English
Tags: financial,future
Short-term investment strategies play a role in an efficient financial market. Market pricesfor shares need to be driven by information on both short-term and longer-term factors. And certain investors may have specific short-term investment horizons, for example because of imminent retirement.However, many sources now show that the balance of investment in the market as a whole has moved too far towards short-termism. So the markets are now dominated by strategies that focus on maximising short-term returns, while underestimating or ignoring the systemic risks,wider impacts or irreversible consequences of this behaviour. This may not deliver the best
outcomes for the investor, either from a financial or from a wider social and environmental
perspective.
Located in: Resources