38,244 new BO accounts in Jan amid stocks’ surge

The number of beneficiary owners’ accounts at the country’s stock market has risen by nearly 2,000 per trading day on average after the December 30 national elections amid bullish vibes at the market.
In 20 trading sessions in January this year, 38,244 BO accounts were opened, sources said.
As of January 31, the number of BO accounts stood at 28,17,041 while the figure was 27,78,797 as of December 31 last year. The number also hit a 18-month high after July 10, 2017 when it was 28,19,707.
Investors usually open new BO accounts or revive their suspended ones when they find the primary and secondary market vibrant, market operators said.
They said that the market was on the rise from the first trading day of this year after the general elections.
The market was largely bearish in last year due to polls-centric political uncertainties and tensions, they said.
The key index of Dhaka Stock Exchange, DSEX, advanced by 435 points in last month to close at 5,821.01 points on January 31. The index reached highest 5,950 points in the month.
The daily average turnover was over Tk 900 crore in January that displayed investors’ growing confidence.
Market experts said that many investors who were on the sidelines last year returned to the market and a number of fresh investors entered the market amid the upward trend at the market after the national polls.
United International University professor and share market analyst Mohammad Musa told New Age, ‘As our investors don’t have enough knowledge about the stock market and finance, they love to go with the flow.’
Investors anticipated that the market would maintain the momentum in the months to come, he said.
Market operators said investors also opened BO accounts to buy initial public offering shares.
The primary market was buoyant in last year that also drew investors’ attention. A number of companies, which have got Bangladesh Securities and Exchange Commission’s permission to float shares, would be listed with the bourses after IPO subscription.
Thirteen companies including one mutual fund collected Tk 601.74 crore through IPOs in 2018 while six companies including two mutual funds had raised Tk 249.25 crore in 2017.
An abnormal surge in the share prices of newly listed companies in the first few days after their debut on the stock exchanges encouraged people to open BO accounts, market operators said.
Opening a BO account with Central Depository Bangladesh Limited through a depository participant, which is usually a stockbroker or a merchant bank, is a must for trading shares at Dhaka Stock Exchange and Chittagong Stock Exchange.
Of the active 28,17,041 BO accounts, 20,55,878 are owned by male investors and 7,48,393 by female investors.
Individual investors operate 17,69,354 BO accounts, investors jointly operate 10,34,917 BO accounts and 12,770 accounts are operated by different companies including institutional investors, CDBL data showed.
Of the accounts (excluding the company-owned BO accounts), 26,36,192 BO accounts are owned by Bangladeshi investors and 1,68,079 accounts owned by non-resident Bangladeshi investors, the data showed.
Currently, an investor has to pay Tk 450 per annum to keep his/her BO account active.
The number of BO accounts reached its peak at around 34 lakh in the fiscal year 2010-11, the year of market bubble-burst, as people, lured by the booming share prices, then had rushed to open accounts with different brokerage houses.
Source: http://www.newagebd.net

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