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48-514: The Multilateral Investment Guarantee Agency ( MIGA ) is an international financial institution which offers political risk insurance and credit enhancement guarantees. These guarantees help investors protect foreign direct investments against political and non-commercial risks in developing countries . MIGA is a member of the World Bank Group and is headquartered in Washington, D.C. in

96-686: A Djibouti port, marking its first support in the form of Islamic finance . The agency also launched PRI-Center.com (now no longer active) as a portal for information on political risk management and investment insurance, which also contained its FDI information services. In 2009, the Board of Directors enacted changes to MIGA's operating procedures and authorized coverage for default of sovereign financial obligations. The agency also launched an annual publication titled World Investment and Political Risk which reports on trends in worldwide investment and corporate perceptions of prospects and risk, as well as shifts in

144-468: A developing country and its emerging market , hence the term bilateral , as opposed to multilateral . Examples include: Financial institutions of neighboring countries established themselves internationally to pursue and finance activities in areas of mutual interest; most of them are central banks , followed by development and investment banks. The table below lists some of them in chronological order of when they were founded or listed as functioning as

192-731: A grant of $ 150 million ($ 212 million in 2012 dollars) from the IBRD. MIGA exceeded $ 1 billion ($ 1.4 billion in 2012 dollars) in investment guarantees within a single year for the first time in 1999. In 2000, MIGA paid its first insurance claim since the agency's founding. In 2001, MIGA's issuance of new investment guarantees grew to $ 2 billion. The agency launched its Small Investment Program in 2005 in an effort to promote investment among small and medium enterprises . That same year, MIGA set up its Afghanistan Investment Guarantee Facility in an effort to promote FDI into Afghanistan. In 2007, MIGA issued investment guarantees for

240-449: A bear market include: A market top (or market high) is usually not a dramatic event. The market has simply reached the highest point that it will, for some time. This identification is retrospective, as market participants are generally unaware of it when it occurs. Thus prices subsequently fall, either slowly or more rapidly. According to William O'Neil , since the 1950s, a market top is characterized by three to five distribution days in

288-446: A buyer, while bears rushed about devouring any shares they could find to close their short positions. An unrelated folk etymology supposes that the terms refer to a bear clawing downward to attack and a bull bucking upward with its horns. A secular market trend is a lasting long-term trend that lasts 5 to 25 years and consists of a series of primary trends. A secular bear market consists of smaller bull markets and larger bear markets;

336-438: A decline may be short-lived, and prices might resume their descent, resulting in a loss for the investor who purchased stocks during a misperceived or 'false' market bottom. Baron Rothschild is often quoted as advising that the best time to buy is when there is 'blood in the streets'—that is, when the markets have fallen drastically and investor sentiment is extremely negative. Some more examples of market bottoms, in terms of

384-426: A downtrend. The terms "bull market" and "bear market" describe upward and downward market trends, respectively, and can be used to describe either the market as a whole or specific sectors and securities. The terms come from London's Exchange Alley in the early 18th century, where traders who engaged in naked short selling were called "bear-skin jobbers" because they sold a bear's skin (the shares) before catching

432-459: A framework which characterizes market trends as predictable price tendencies within the market when price reaches support and resistance levels, varying over time. A future market trend can only be determined in hindsight, since at any time prices in the future are not known. Past trends are identified by drawing lines, known as trendlines, that connect price action making higher highs and higher lows for an uptrend, or lower lows and lower highs for

480-508: A full recession , or earlier. Generally, bull markets begin when stocks rise 20% from their low and end when stocks experience a 20% drawdown. However, some analysts suggest a bull market cannot happen within a bear market. An analysis of Morningstar, Inc. stock market data from 1926 to 2014 revealed that, on average, a typical bull market lasted 8.5 years with a cumulative total return averaging 458%. Additionally, annualized gains for bull markets ranged from 14.9% to 34.1%. A bear market

528-478: A geographic concentration area for their development objectives. With this geographic and thematic focus, funding for a variety of ventures – often resource-intense infrastructure projects – is provided. Since MDBs have a shareholding structure and are backed by member countries, they tend to profit from favorable loan conditions compared to other banks and can therefore take more risks in their investment strategy. This aids their development-driven cause. Since

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576-603: A legal entity. Some institutions were conceived and started working informally 2 decades before their legal inception (e.g. the South East Asian Central Banks Centre) Market trend A market trend is a perceived tendency of the financial markets to move in a particular direction over time. Analysts classify these trends as secular for long time-frames, primary for medium time-frames, and secondary for short time-frames. Traders attempt to identify market trends using technical analysis ,

624-523: A major stock market index occurring within a relatively short period of time. Distribution is identified as a decline in price with higher volume than the preceding session. The peak of the dot-com bubble , as measured by the NASDAQ-100 , occurred on March 24, 2000, when the index closed at 4,704.73. The Nasdaq peaked at 5,132.50 and the S&;P 500 Index at 1525.20. The peak of the U.S. stock market before

672-497: A multilateral institution, MIGA is also in a position to attempt to sort out potential disputes before they ever turn into insurance claims. MIGA requires insured investors to establish communications and consultations with local communities and set in place grievance procedures. The agency's Small Investment Program aims to promote FDI into specifically small and medium-sized enterprises. The program offers standard MIGA coverage types except it does not cover breaches of contract. Under

720-408: A possible five-year extension depending on a given project's nature and circumstances. When an event occurs that is protected by the insurance, MIGA can exercise the investor's rights against the host country through subrogation to recover expenses associated with covering the claim. However, the agency's convention does not require member governments to treat foreign investments in any special way. As

768-470: A secular bull market consists of larger bull markets and smaller bear markets. In a secular bull market, the prevailing trend is "bullish" or upward-moving. The United States stock market was described as being in a secular bull market from about 1983 to 2000 (or 2007), with brief upsets including Black Monday and the Stock market downturn of 2002 , triggered by the crash of the dot-com bubble . Another example

816-510: A strategy of 'fading' investors' actions—buying when others are selling and selling when others are buying. A period when most investors are selling stocks is known as distribution, while a period when most investors are buying stocks is known as accumulation. "According to standard theory, a decrease in price typically leads to less supply and more demand, while an increase in price has the opposite effect. While this principle holds true for many assets, it often operates in reverse for stocks due to

864-429: A survey in 2010 which showed that political risk is the most important deterrent of long-term foreign direct investment in developing countries, even more than economic uncertainty and poor public infrastructure . MIGA's Council of Governors amended the agency's convention in 2010 in an attempt to improve the organization's effectiveness by expanding the range of investments eligible for political risk insurance. MIGA

912-426: Is a development bank , created by a group of countries, that provides financing , technical assistance and professional advice to enhance development . An MDB has many members, including developed donor countries and developing borrower countries. MDBs finance projects through long-term loans at market rates, very-long-term loans below market rates (also known as credits), and grants. Additionally, MDBs often have

960-420: Is a general decline in the stock market over a period of time. It involves a transition from high investor optimism to widespread investor fear and pessimism. One generally accepted measure of a bear market is a price decline of 20% or more over at least a two-month period. A decline of 10% to 20% is classified as a correction . Bear markets conclude when stocks recover, reaching new highs. The bear market

1008-827: Is assessed by the World Bank's Independent Evaluation Group each year. In September 1985, the Board of Governors of the World Bank endorsed the Convention establishing the Multilateral Investment Guarantee Agency. MIGA was established and became operational on 12 April 1988 under the leadership of then-Executive Vice President Yoshio Terasawa , becoming the fifth member institution of the World Bank Group. MIGA initially had $ 1 billion ($ 1.94 billion in 2012 dollars) in capital and 29 member states. All members of

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1056-687: Is available only to countries who are members of the World Bank, particularly the International Bank for Reconstruction and Development. As of 2022, the six World Bank member states that are not MIGA members are Brunei , Kiribati , the Marshall Islands , San Marino , Tonga , and Tuvalu (the UN member states that are non-members of the World Bank, and thus MIGA, are Andorra , Cuba , Liechtenstein , Monaco , Nauru , and North Korea ). The Holy See and Palestine are also non-MIGA members. Somalia

1104-445: Is effectively shared responsibility for repayment, the banks can often borrow more cheaply than could any one member nation. These banks include: There are also several multilateral financial institutions (MFIs). MFIs are similar to MDBs but they are sometimes separated since they have more limited memberships and often focus on financing certain types of projects. The best-known IFIs were established after World War II to assist in

1152-428: Is governed by its Council of Governors which represents its member countries. The Council of Governors holds corporate authority, but primarily delegates such powers to MIGA's Board of Directors. The Board of Directors consists of 25 directors and votes on matters brought before MIGA. Each director's vote is weighted in accordance with the total share capital of the member nations that director represents. MIGA's board

1200-547: Is stationed at its Washington, D.C. headquarters where it meets regularly and oversees the agency's activities. The agency's Executive Vice President directs its overall strategy and manages its daily operations. As of 16 December 2019, Hiroshi Matano serves as Executive Vice President of MIGA. MIGA is owned by its 182 member governments, consisting of 156 developing and 25 industrialized countries. The members are composed of 181 UN member states plus Kosovo . Membership in MIGA

1248-537: Is the 2000s commodities boom . In a secular bear market, the prevailing trend is "bearish" or downward-moving. An example of a secular bear market occurred in gold from January 1980 to June 1999, culminating with the Brown Bottom . During this period, the market price of gold fell from a high of $ 850/oz ($ 30/g) to a low of $ 253/oz ($ 9/g). The stock market was also described as being in a secular bear market from 1929 to 1949. A primary trend has broad support throughout

1296-744: Is the most recent country to have joined MIGA, having done so in March 2020. MIGA offers insurance to cover five types of non-commercial risks: currency inconvertibility and transfer restriction; government expropriation ; war, terrorism, and civil disturbance; breaches of contract ; and the non-honoring of financial obligations. MIGA will cover investments such as equity, loans , shareholder loans , and shareholder loan guarantees. The agency may also insure investments such as management contracts , asset securitization , bonds , leasing activities, franchise agreements , and license agreements . The agency generally offers insurance coverage lasting up to 15 years with

1344-498: Is then assessed retrospectively from the recent highs to the lowest closing price, and its recovery period spans from the lowest closing price to the attainment of new highs. Another commonly accepted indicator of the end of a bear market is indices gaining 20% or more from their low. From 1926 to 2014, the average duration of a bear market was 13 months, accompanied by an average cumulative loss of 30%. Annualized declines for bear markets ranged from −19.7% to −47%. Some examples of

1392-533: The Dow Jones Industrial Average index after the Wall Street Crash of 1929 , leading down to the market bottom in 1932, and throughout the late 1960s and early 1970s. The Japanese Nikkei 225 has had several bear-market rallies between the 1980s and 2011, while undergoing an overall long-term downward trend. The price of assets, such as stocks, is determined by supply and demand. By definition,

1440-568: The European Bank for Reconstruction and Development . The Islamic Development Bank is among the leading multilateral development banks. IsDB is the only multilateral development bank after the World Bank that is global in terms of its membership. 56 member countries of IsDB are spread over Asia, Africa, Europe and Latin America. A bilateral development bank is a financial institution set up by one individual country to finance development projects in

1488-789: The International Bank for Reconstruction and Development (IBRD) were eligible to become members of the agency. MIGA was established as an effort to complement existing sources of non-commercial risk insurance for investments in developing countries. By serving as a multilateral guarantor, the agency reduces the likelihood of confrontations among the investor's country and the host country. MIGA's inaugural investment guarantees were issued in 1990 to cover $ 1.04 billion ($ 1.83 billion in 2012 dollars) worth of foreign direct investment (FDI) comprising four individual projects. The agency also issued its first reinsurance contracts signed in collaboration with Export Development Canada and

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1536-577: The United States . MIGA was established in 1988 as an investment insurance facility to encourage confident investment in developing countries. MIGA is owned and governed by its member states, but has its own executive leadership and staff which carry out its daily operations. Its shareholders are member governments that provide paid-in capital and have the right to vote on its matters. It insures long-term debt and equity investments as well as other assets and contracts with long-term periods. The agency

1584-488: The financial crisis of 2007–2008 occurred on October 9, 2007. The S&P 500 Index closed at 1,565 and the NASDAQ at 2,861.50. A market bottom marks a trend reversal, signifying the end of a market downturn and the commencement of an upward-moving trend (bull market). Identifying a market bottom, often referred to as 'bottom picking,' is a challenging task, as it's difficult to recognize before it passes. The upturn following

1632-547: The 2020s, in the context of the G20 , the World Bank - IMF Annual Meetings and other International Summits, MDBs have committed to multiple shared reform objectives. This MDBs Reform process aims to integrate MDBs in terms of operational practices, objectives, financial metrics and governance structures, enabling them to work as a system in development projects, to mobilize additional capital and achieve credit rating stability. The Capital Adequacy Framework (CAF) reform has been one of

1680-663: The United States' Overseas Private Investment Corporation (OPIC). The agency joined the Berne Union , an international community of export credit and investment insurance providers in 1994. In 1997, MIGA issued the inaugural contract under its Cooperative Underwriting Program to support an energy project in Indonesia . In collaboration with the European Union Investment Trust Fund for Bosnia and Herzegovina ,

1728-722: The World Bank group's activities, but with particular focus on a specific region. Shareholders usually consist of the regional countries plus the major donor countries. The best-known of these regional banks cover regions that roughly correspond to United Nations regional groupings, including the Inter-American Development Bank , the Asian Development Bank ; the African Development Bank ; the Central American Bank for Economic Integration ; and

1776-568: The agency set up a fund for investment guarantees amounting to $ 12 million ($ 17 million in 2012 dollars). The agency also established the West Bank and Gaza Investment Guarantee Trust Fund with a capacity of $ 20 million ($ 29 million in 2012 dollars). In 1998, the Council of Governors of MIGA adopted a resolution establishing a general capital increase of $ 850 million ($ 1.2 billion in 2012 dollars), and transferring

1824-438: The bear. This was simplified to "bears," while traders who bought shares on credit were called "bulls." The latter term might have originated by analogy to bear-baiting and bull-baiting , two animal fighting sports of the time. Thomas Mortimer recorded both terms in his 1761 book Every Man His Own Broker . He remarked that bulls who bought in excess of present demand might be seen wandering among brokers' offices moaning for

1872-427: The closing values of the Dow Jones Industrial Average (DJIA) include: Secondary trends are short-term changes in price direction within a primary trend, typically lasting for a few weeks or a few months. Similarly, a bear market rally , sometimes referred to as a 'sucker's rally' or ' dead cat bounce ', is characterized by a price increase of 5% or more before prices fall again. Bear market rallies were observed in

1920-433: The common mistake made by investors—buying high in a state of euphoria and selling low in a state of fear or panic, driven by the herding instinct. In cases where an increase in price leads to an increase in demand, or a decrease in price leads to an increase in supply, the expected negative feedback loop is disrupted, resulting in price instability. This phenomenon is evident in bubbles or market crashes. Market sentiment

1968-407: The entire market, across most sectors, and lasts for a year or more. A bull market is a period of generally rising prices. The start of a bull market is marked by widespread pessimism . This point is when the "crowd" is the most "bearish". The feeling of despondency changes to hope, "optimism", and eventually euphoria as the bull runs its course. This often leads the economic cycle, for example, in

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2016-455: The main fields of MDB reform, aiming the enhance financing capacity and harmonize financial metrics among MDBs. The following are usually classified as the main MDBs: There are also several "sub-regional" multilateral development banks. Their membership typically includes only borrowing nations. The banks lend to their members, borrowing from the international capital markets . Because there

2064-526: The market balances buyers and sellers, making it impossible to have 'more buyers than sellers' or vice versa, despite the common use of that expression. During a surge in demand, buyers are willing to pay higher prices, while sellers seek higher prices in return. Conversely, in a surge in supply, the dynamics are reversed. Supply and demand dynamics vary as investors attempt to reallocate their investments between asset types. For instance, investors may seek to move funds from government bonds to 'tech' stocks, but

2112-420: The political risk insurance industry. Although once dominated by large public and multilateral underwriters , private insurance firms accounted for approximately half of the political risk insurance market in 2007. As a result, MIGA has paid closer attention to exceptionally risky countries that have little appeal to foreign investors, and has insured projects among nations in the global south . MIGA conducted

2160-485: The program, small and medium enterprises may take advantage of discounted insurance premiums and no application fees, which are not available to larger investors. To qualify an investment for the Small Investment Program, MIGA defines small and medium enterprise projects as having 300 or fewer employees, total assets not to exceed $ 15 million and annual revenues not to exceed $ 15 million. MIGA limits

2208-626: The reconstruction of Europe and provide mechanisms for international cooperation in managing the global financial system . They include the World Bank , the IMF , and the International Finance Corporation . Today the largest IFI in the world is the European Investment Bank which lent 61 billion euros to global projects in 2011. The regional development banks consist of several regional institutions that have functions similar to

2256-467: The request amount for the investment guarantee to $ 10 million, and will guarantee only up to 10 years with a possible 5-year extension. MIGA's annual reports offer an overview of the agency's business. MIGA prepares consolidated financial statements in accordance with United States GAAP which are audited by KPMG . [REDACTED]   World Bank Group International financial institutions A Multilateral Development Bank ( MDB )

2304-440: The success of this shift depends on finding buyers for the government bonds they are selling. Conversely, they might aim to move funds from 'tech' stocks to government bonds at another time. In each case, these actions influence the prices of both asset types. Ideally, investors aim to use market timing to buy low and sell high, but in practice, they may end up buying high and selling low. Contrarian investors and traders employ

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