Equity markets are diverse. There are the exchanges which deal with listed shares of the largest companies in the world and exchanges, sometimes the same ones, dealing with fledgling companies. There are also unlisted securities.

Equity markets are high profile. The news bulletins on television and radio often refer to the rise or fall of the local index on the stock market. Many private investors start their portfolios with equity shares, sometimes from incentive schemes operated by their employers or as a result of a government privatizing a hitherto-nationalized industry. The policy of the Conservative government in the UK, under Margaret Thatcher, created thousands of new investors with the selling off of companies and utilities like British Telecom and British Gas. Share options are a popular way to reward and 'lock-in' employees, as this option gives them the opportunity to convert to shares and have a stake in the company and thus its success.

Equity markets therefore act as another kind of barometer of the wellbeing of a country, reflecting the prospects of manufacturing, services, utilities, etc. They also offer good value to the investor as both a profit, as a result of an increase in share price, and a return, in the form of dividends, is possible. Possible is the key word here. Unlike most debt, which will result in the par value being redeemed and some debt where the return in the form of interest is fixed, equity is totally different. An investor might buy shares and never...