A guide to Dhaka Stock Exchange For the Beginners

A guide to Dhaka Stock Exchange For the Beginners 

Bangladesh has two capital market, and those are Dhaka Stock Exchange and Chittagong Stock Exchange. 

Investing in stock market was never being an easy job to do. But still its the most profitable place if you follow the rules strictly. 

Be sure you do not want to make huge amount of money within few weeks. This market is the most difficult one to make money, but once you learnt the tricks you are up in the air. 

This article will elaborate the step by step investment guidelines for the beginners who wants to invest or trade under Dhaka Stock exchange.  

Follow the steps properly, and practice those things recommended there. 

Visit: Guidelines To Invest in Dhaka Stock Exchange

Fundamental Analysis

Fundamental analysis is a type of analysis which allows you to analyze the about a business, its competitive advantages, markets and its competitors.

   
When it comes to Stock and Forex, it calculates the intrinsic or real value. To calculate a stocks real intrinsic value, it uses different factors like earning capability, market shares, production capacity etc. To analyze Forex it considers on different economical indicators like gross domestic production, income level changes, interest rate changes, inflation rate, balance of trade surplus and deficit, consumer price index and government fiscal and monetary policy.

Fundamental analysis is based on a believe that price tries to move towards its real value.

The benefits of fundamental analysis are it can calculate the real value of a company, calculate the risk involved, and identify the long term investments. The major downside of this analysis is because of its large area of analysis novice can get confused with this analysis.

Daily Market Observation of Dhaka Stock Exchange. August 14, 2014.

Today DsEx changed by 27.3 points while the turnover was 632 Cror.

Market is now in Uptrend.

Trend Analysis: If we see closely, we will see dsex recently broke a resistance (4487) and got entered a new zone. after breaking the resistance dsex met the supply and absorbed it smartly. it last started a new phase today, there is a very good chance of continuation of the current trend.

Indicators: RSI is in positive zone and it will  likely continue. Also, MACD is in positive zone.

Daily Market Observation - 28th June, 2012- Market Gets little bit correction today after two big green day.

Here we can see a profit taking day.

Authorized capital, Paid-up Capital and Market Capital

Market capital

Market capitalization is just a fancy name for a straightforward concept: it is the market value of a company's outstanding shares. This figure is found by taking the stock price and multiplying it by the total number of shares outstanding. For example, if ABC was trading at 20 per share and had a million shares outstanding, then the market capitalization would be 20 million (20 x 1 million shares). It's that simple.

Authorized capital

The authorised capital of a company (sometimes referred to as the authorised share capital or the nominal capital, particularly in the United States) is the maximum amount of share capital that the company is authorised by its constitutional documents to issue to shareholders. Part of the authorised capital can (and frequently does) remain unissued.

Paid-Up Capital

The total amount of shareholder capital that has been paid in full by shareholders.

Paid-up capital is essentially the portion of authorized stock that the company has issued and received payment for.

Relation between Authorized capital and Paid-up Capital

If company ABC has an authorized capital of 1000mn, and paid-up capital of 200mn, it is still allowed to issue a value of 800mn (1000mn-200mn=800mn).

How a Company increases its paid-up capital?

A company can increase its paid-up capital when it needs. Procedures are issuing right shares, issuing bonds and allotting stock dividend.

CIRCUIT BREAKER

What is 'Circuit Breaker' ?

Circuit Breaker is the maximum permissible deviation of the price (specified as percentage) of the incoming order from the Circuit Breaker Base Price for that instrument. Orders violating circuit breaker will result rejection of the order.

Percentage of circuit breaker by its yesterday closing price:

a. Below 200          10%
b. 201 -  500           8.25%
c. 501 -  1000         7.5%
d. 1001 - 2000        6.25%
e. 2001 - 5000        5%
f. 5001 and above  3.75% but not more than 300 bdt.

How to Calculate?

Say, yesterday closing price of company ABC is 235. It falls between 201 and 500 tk that follows a breaker of  8.25%.

now, 8.25% of 235 is 19.38 tk.

If the base price is 235, breaker price will be +- 19.38 tk. This means the price of company ABC can go up to 235+19.38=257.35 or can go down to 235-19.38=215.65 tk.