Abstract
The financial market in general is where supply and demand for funds are met. In other words, funds saved in the financial market are directed to investments in order to contribute to the economy. In the Macedonian financial market, the banking sector is really dominant but also pension funds and insurance funds have an active role. This research will be studied the distribution of pension funds’ portfolios in the North Macedonian financial market. The global financial crisis in 2008 negatively affected the economies and financial markets of many countries, including the USA and Europe, and the effects of the crisis continued until 2013. This negatively affected the confidence in the financial markets, and the current surplus of funds was directed towards low-risk but fixed or low-yield financial instruments. As of 31.12.2018, fund accumulation in private pension funds amounted to 1.04 billion euros, corresponding to approximately 10 percent of GDP. The total premium production of insurance companies is around 157 million euros, while the GDP ratio of premium production is around 1.5 percent. Funds collected in both sectors are generally used in treasury bills, bank deposits, and stocks traded on the Macedonia Stock Exchange and foreign financial markets.
Highlights
Financial market is where supply and demand of funds are met
While the banking sector plays a large and important role in the financial markets of North Macedonia, the pension funds are in the second place, which constitute 9.75 percent of GDP as of the end of 2018
Private pension companies and pension funds managed by these companies actively operate in the mandatory private pension system
Summary
Financial market is where supply and demand of funds are met. New investments cannot be made in the absence of financial markets or in case of undeveloped financial markets. While the banking sector maintains its dominance in the financial markets of North Macedonia, the private pension funds rank second. Another area that transfers funds to financial markets is the insurance sector. While home insurance is around 17 percent, the share of insurance in total premium production is around 8 percent
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