2. Explain the Issue
Globalisation has resulted in greater connection among markets around the world and increased communication and
awareness of business opportunities over the world
More investors can access new investment opportunities and study new markets at a greater distance than before, and
not just rely on the local stock market
Potential risks and profit opportunities are within easier reach thanks to improved communications technology. Countries
with positive relations between them are able to increasingly unify their economies through increased investment and
trade. Products and services previously available within only one country are made more readily available to new
markets
For investors, these opportunities set a wider range of investment options and new ways to profit.
3. Discuss how this affects Different Investment Options
Globalisation encourages businesses to adapt to different strategies based on new trends that try to balance rights and
interests of both the individual and the community as a whole.
Globalisation determines what companies they should invest in. This is due to the fact that Australian companies may have
large HQ’s in other countries due to globalisation and when the AUD is low compared to other places this can result in a lot
of profit for the company and this ultimately results in an increase in share prices.
For instance, CSL is an Australian company that gains most of it profits from the US, currently in Australia the AUD
compared to the USD and because of this CSL is turning a big profit and its share price has increased by 7 points in the last
3 weeks. Many Australians have seen this occur and have bought into CSL shares, but without globalisation CSL may have
never started providing for and operating in the US.
4. Who Benefits + Why
Companies - companies benefit as globalisation allows them to expand and reach out to many countries all over the world.
This means more consumer, larger target market and this ultimately results in an increase in profit margins for the company.
Companies also have increasingly turned to global markets as a source not only of new customers but also of production
locations and partners for new ventures.
Investors - Investors benefit as a result of this companies thriving in the internationally market and other markets all over
the world. As these companies grow and become international companies their profit margins increase and this is very good
for investors as when companies begin to make money their share price almost always goes up as well.
5. Who Loses
As a result of globalisation, most businesses try to stay competitive with their counterparts in other parts of the world, broadening
their competitive horizons past their local areas and home countries.
Because of increased competition from global counterparts, some companies find it difficult to keep up with their global
counterparts.
So in a way companies can win and lose based on globalisation as the competition can benefit a company, but in the same way
it could work against a company.
