The domestic stock market is an option when investing money, because on April 15 the deadline for the payment of benefits to workers in relation to maintenance, in the amount corresponding to the earnings from 2022, expires.

Workers set aside part of this money to pay off outstanding debts, buy a home or invest.

This is extra money that can be invested in the stock market, where profits can be made in less than a year.

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According to On April 12, 2023, the amount traded on the Guayaquil Stock Exchange adds 1,737.5 million dollars. Of that total, $1,713.6 million correspond to titles that leave fixed income, and $23.8 million are those with variable income (stock purchases).

This included the total 3,479 transactions were completed.

On the same day in April 2022. the negotiated amount has already reached 2,056.7 million dollars.

Companies are obliged to distribute 15% of the net profit made in the previous year to their employees. Of the total amount, 10% will be distributed equally to all employees, and the remaining 5% to workers with family obligations (spouses or common-law partners, children under 18 and children with disabilities of any age).

Guayaquil Stock Exchange (BVG) prepared a a guide with guidelines for the proper management of these resources if you decide to invest them.

“Regardless of the amount the worker receives, the payment of profits is an excellent opportunity to invest in the stock market and realize future profits,” says Ricardo Rivadeneira, president of BVG.

There are several options in the stock market for investing that extra money.

The stock market, as its name suggests, is a place where financial assets are bought and sold. Business entities turn to it, from companies, private banks and groups to state entities in search of financing.

The BVG defines the stock market as “a segment of the financial market that enablesmobilization of resources from savers or investors towards production activities carried out by companies by buying and selling securities issued by the companies themselves.

Natural persons invest their money, in this case that from profits and which finance the activities of economic entities, in exchange for benefits.

There is no minimum base amount to buy shares, but the investment must be greater than the collection of commissions generated by the houses and the two stock exchanges in Ecuador.

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Fixed income securities are the most traded on stock exchanges in the country. They are called that because, as the name suggests, “they are fixed income securities issued by legally authorized issuers that recognize or create debt under their responsibility based on future income they expect“.

The purpose of its issuance is to finance its production activities, such as working capital, debt restructuring, expansion or new projects.

Between January and February 2023 alone, fourteen titles in the amount of 92.5 million dollars were registered with the BVG, of which 61% correspond to large companies and 39% to medium-sized companies.

There are two stock exchanges in Ecuador, the one in Quito and Guayaquil.

He the national stock market closed with a total turnover of $13,452 million during 2022.

Investment certificates and term funds were the most traded titles last year. Of the 6,538 million dollars, the contracted amount reported by BVG in 2022, 31.7% correspond to investment certificates, and 25.8% to time deposits.

Private companies increased their participation in the stock market in 2022, mainly through the issuance of financial sector securities.

In 2021, this sector traded titles with a total value of $5,754 million, 36.6% of the total, while in 2022, the figure rose to $6,586 million and the share rose to 51%.

Money placement contracted by the private sector grew by 19.2% from 2021 to 2022.

Rivadeneira states that “it is always a great pleasure for large, medium and small companies to bet and make a decision about entering the stock market. These are the decisions that allow companies to grow and contribute to the national economy.”

Five reasons and options for investing in the stock market

1.- The first is that benefits are achieved with less risk. “In the stock market, investors (people with available resources to purchase titles) and issuers (companies offering titles to obtain resources) come into direct contact. Since the contact is direct, both parties benefit. In the case of investors, with more favorable prices”, the BVG guide states.

2. short-term benefits. Since the profits are annual amounts, it is advisable to invest in short-term titles (less than one year). In this way, in a period of less than a year, the investor will have his money plus profit again.

3. There are two possibilities. Short-term titles you can invest in are commercial records and commercial invoices. The first titles are issued by companies to finance working capital, in practice it is the recognition of debt in favor of investors who will pay in less than a year plus interest. Others are invoices that enter the stock market and the investor then receives capital plus an attractive return.

4. You have toDetermine the percentage to invest. The recommended thing is set aside at least 10% of your profits to invest in the stock market.

5. Continue with the investment action. “By buying short-term securities, you will make a profit in less than a year. It is recommended to continue with the acquisition of titles in the following profit payments with the acquired experience”, the subject states.