Market’s stability is main focus: BSEC
The Bangladesh Securities and Exchange Commission (BSEC) has been emphasising market stability because it otherwise leads to losses for general investors, said Khairul Hossain, chairman of the stock market regulator.
For the market to remain stable, adequate corporate disclosure should be available for all and the information should be authentic while investors should also have the knowledge to analyse the information, he said.
“Insider trading should also be reined in and the BSEC is careful about curbing insider trading,” added Hossain.
His comments came in a symposium on “Investor Education and Protection” organised by the Central Depository Bangladesh Ltd (CDBL) at Pan Pacific Sonargaon in Dhaka on Wednesday night.
Addressing as chief guest, Hossain said investors would have to acquire knowledge before investing in stocks because it was necessary to ensure the safety of their investment.
Hasan Imam, chief executive officer (CEO) and managing director of RACE Asset Management, said Bangladesh’s capital market was retail investor-driven, which was the opposite of developed markets in the world.
Those markets are institutional investor-driven, for which those behave smartly, he said, adding that a developed capital market recovers very fast after a fall.
“But our stock market remains sluggish even after a few years,” he said.
Responding to a question, Md Moniruzzaman, managing director of IDLC Investments, said making investment by taking margin loans was not profitable in Bangladesh, rather those had adverse impacts on market stability.
This is because investors want quick profits with margin loans, he said, adding, “Our stock market growth is not over 15 percent, so investors ultimately lose money through margin loans.”
The interest rate of margin loans is more or less 15 percent, according to the merchant banker.
Farhad Ahmed, executive director of the BSEC, Shakil Rizvi, president of the DSE Brokers’ Association, Sheikh Kabir Hossain, chairman of the CDBL, and Shuvra Kanti Choudhury, managing director, also spoke at the event.
