Topic on: “Trading behavior of retail investor in stock market”

Submitted To:

Faculty: Dewan Muktadir-Al-Mukit

Lecture

Department of Bachelor Administration

Submitted By:

Name:

Nure Alom Siddiqee (Leader) 1481

Abdul Rakib (Rabbe) 1487

Akhtaruzzaman 1489

Rashida Khanom 1491

Panna Sarkar 1486

Subject: Principles of Finance

Course Code: FIN 602

Batch: 30th

Date: 03.09.2012
Title: Determination of Trading Behavior of investors of DSE

Serial No. Page No.

TABLE OF CONTENTS
Letter of Transmittal i

Acknowledgement iii

Executive Summary iv

Chapter 1 Introduction of the Report

1.1 Objectives of the study

1.2 Rationale of the Study

1.3 Limitations

1.4 Methodology

Chapter 2 An overview of capital market in Bangladesh

2.1 The Dhaka Stock Exchange (DSE)

2.2 The Chittagong Stock Exchange (CSE)

2.3 The Securities and Exchange Commission (SEC)

2.4 Present Status of Capital Market

2.5 Contribution of Capital Market to GDP

Chapter 3 Analysis of Survey on Retail Investors

3.1 Frequency Distribution Analysis

3.2 One-Sample T-Test

Chapter 4 Findings, Policy Suggestions and Concluding Remarks

Appendices
03st September, 2012

Dewan Muktadir-al-Mukit

Lecturer

Department of Bachelor of Business Administration

World University of Bangladesh

Subject: Submission of the report on “Trading behavior of retail investor in stock market”

Dear Sir,

With humble submission we want to thank you for assigning us the pragmatic Report on
“Trading behavior of retail investor in stock market”. We have really enjoyed various steps
preparing the Report. We have made strong group works and have also collected different
data from stock market. We think this report enriched our practical knowledge on Stock
market. There may be some unwilling mistakes. We hope the mistakes in the report will
be kindly excused.

With thanks & best regards,

Sincerely yours,
On behalf of group
Md.Nure Alom Siddiqee
ID: 1481
BBA (30th Batch)
Faculty,School of Business
World University of Bangladesh
 Acknowledgement

At first we would like to thank Almighty Allah who gives us energy, patient and also knowledge for
making some efforts to make this report. Besides we express our heartiest gratitude to our Head of the
Department, Professor Md.Moqbul Hossain for giving us this course to learn about the procedures of
Insurance Policy. We would like to thank Dewan Muktadir al Mukit,for her time beyond the lecture
sessions, & to offer the assignment to learn current situation in stock market in Bangladesh. His real life
examples in the class have undoubtedly enabled us to understand the concepts and to prepare a better
quality report.

This report would have been impossible without the valuable contributions and limitless help of several
individuals. Finally we want to thanks our friends and course mates who helped us for gaining
information and complete the assignment successfully.

Executive Summary

This report is based on the current situation in Bangladesh stock market. Current situation in stock
market is not well. This report also enriches our knowledge about stock market in Bangladesh. The
literature on the contribution of share market in economic development is rife with
controversies. There is a voluminous empirical literature based on cross-country regressions,
which has produced more confusions than robust conclusions. In addition, this literature has
little or nothing to contribute when it comes based on the method of randomization. The
method has been criticized for its narrow focus. It cannot tell us “what works’ in development,
to design policy, or to advance scientific knowledge about development processes.” It has also
been opined that it cannot be the basis for a cumulative research program that might
progressively lead to a better understanding of development”. Moreover, it provides little
guidance on the share market to the economic development at the macro level. However, in
the real world, people need to draw conclusions about effectiveness of share market activities
in an economy and make policies.

Given the manifest failures of the so-called rigorous empirical methods to yield useful
insights, the present study takes a more quantative approach to analyze the share market.
The paper begins with a discussion of the importance of share market & its contribution to the
GDP growth of Bangladesh as it has evolved over time. This is followed by a critical evaluation
of the economic and social impact caused by the instability of share market activities, with
careful assessments. The paper then discusses the causes of aid ineffectiveness. As this theme
has a wider resonance beyond Bangladesh, the discussion next turns to the experiences of the
developing world as a whole. Recommendations given for making share market’s investments
more effective and the paper ends with some concluding remarks about the future role of
share market in Bangladesh.

Introduction to report
 Introduction

Capital Market mainly refers to the Stock and Share market of the country. When
banking system cannot totally meet up the need for funds to the market economy,
capital market stands up to supplement it. Companies and the government can raise
funds for long-term investments via the capital market. The capital market includes
the stock market, the bond market, and the primary market. Securities trading on
organized cap-ital markets are monitored by the government; new issues are
approved by authorities of financial supervision and monitored by participating
banks. Thus, organized capital markets are able to guarantee sound investment
opportunities. This paper reveals the various aspects of the Capital Market in
Bangladesh.

Formation

DSE is a public company which established and supervised under Company Act 1994, Security
and Exchange Commission Act 1993, Security and Exchange Commission Regulation 1994,
Security Exchange (Inside Trading) Regulation 1994. Presently, DSE has 195 members.
1.1 Objectives of the study

Satisfied investors are a necessary element of the stock market. They help to finance rapid
expansion in developing countries. This study explores the factors that contribute to the
satisfaction level of retail investors.

The specific objectives of this study are:

● To Identify trading behavior of retail investors.
 Develop a strong platform for entrepreneurs for raising capital.
 Provide an investment opportunity for small and large investors.
 Develop a transparent market ensuring investor's interest.
 Provide a fully automated trading system with most modern amenities to ensure quick,
easy, accurate transactions and easily accessible to all
  Attract non-resident Bangladesh is to invest in Bangladesh stock market
 Attract foreign institutional investors to invest in Bangladesh
 Collect, preserve, disseminated and information on stock exchange

1.2 Rationale of the Study: It’s very important to us about stock market. Its play vital

role in our economy. Now we also understood about the stock market. We survey
30 investor in stock market. They have different experience about stock market and
share with us. They suggest us how to invest in share market which share is to
buying etc.

1.3 Limitations: Most of the Investors are not agreeable to be interviewed them. They seem
little bit panic about the survey. getting time to finish this report is not sufficient and do not get
better co operation from group member to finish this report.

1.4 Methodology
Primary Source:
A sample survey of 30 investors in stock market in DSE in Bangladesh.

Secondary Source:
 DSE website
 Google search
 Wikipedia

Data Analysis:
In order to accomplish the aims of the research, the following analytical software were used
for the data analysis:
- SPSS
- Excel
2.0 An overview of capital market in Bangladesh

2.1 The Dhaka Stock Exchange (DSE)

History and Origin of DSE

Founded on 28th April 1954, DSE formerly known as East Pakistan Stock Exchange Ltd. Which
began its formal trading in 1956 and on 23rd June 1962 it was called as East Pakistan Stock
Exchange. On 13th May 1964, its name was changed again and it became known as Dacca Stock
Exchange Ltd. In 1971- post the Liberation War, the trading was stopped temporarily for five
years which started again in 1976. DSE All Share Price Index was began on 16th September
1986 and on 1st November 1993, accordant with IFC the formula of calculating DSE All Share
Price Index was changed. On 10th August 1998, the automatic trading was launched in DSE. On
1st January 2001, DSE 20 Index and on 24th January 2004 Central Depository System were
initiated.

Formation

DSE is a public company which established and supervised under Company Act 1994, Security
and Exchange Commission Act 1993, Security and Exchange Commission Regulation 1994,
Security Exchange (Inside Trading) Regulation 1994. Presently, DSE has 195 members.
The major functions are

 Listing of Companies. (As per Listing Regulations).

 Providing the screen based automated trading of listed Securities.
 Settlement of trading.(As per Settlement of Transaction Regulations)
 Gifting of share / granting approval to the transaction/transfer of share outside the trading
system of the exchange (As per Listing Regulations 42)
 Market Administration & Control.
 Market Surveillance.
  Monitoring the activities of listed companies. (As per Listing Regulations).
 Investor’s grievance Cell (Disposal of complaint bye laws 1997).
 Investors Protection Fund (As per investor protection fund Regulations 1999)
 Publication of Monthly Review.
 Announcement of Price sensitive or other information about listed companies through

2.2 The Chittagong Stock Exchange (CSE)

The major functions are:

 Grant Affiliation up to +2 Schools

 Conducting Examination & Publishing Results.
 Awarding Certificate to Secondary & Senior Secondary School Candidates.
 Supervising & Monitoring Schools / Study Centers / AIS Affiliated with CSE.

 Implementing plans & Programmers for improving Secondary, Senior Secondary

Education.
 Recruiting Technical, Professional & Administrative Staff.
Securities and Exchange Commission:

Capital market plays a significant role in the economy as a source of long term financing. A fair,
efficient and transparent capital market is essential for a country for its industrialization and
economic development. To develop such a fair, efficient and transparent capital market, the
Securities and Exchange Commission was established as a regulator through enactment of the
Securities and Exchange Commission Act, 1993 in June 1993, with the following mission:

• Protecting the interest of investors in securities;

• Developing the capital and securities markets; and
• Framing of securities rules concerning above.

The Commission frames rules and regulations under the relevant laws ensure control of the capital
market through compliance of duties and responsibilities of the issuer, stock exchange and market
intermediaries.
The Commission consists of a chairman and four full time members who are appointed by the
government for a period of three years as per law, and terms of their service is determined by the
government. The Chairman is the chief executive officer of the Commission.

Present Status of Capital Market

Bangladesh Securities market witnessed a strong momentum throughout the year 2012-13.
Almost all the market indicators have positive signs over the previous year. The turnover value
crossed TK 26.00 billion-mark for the first time in the history of the securities market of the
Bangladesh indicating high liquidity of the market.

As on October 2010 -DSE

Total Number of Listed Securities 442

Total Number of Companies 217

Total Number of Mutual Funds 29

Total Number of Debentures 8

Total Number of Treasury Bonds 186

Total Number of Corporate Bonds 2

Total number of Shares/Certificates: (No. in mn)

Total Number of Shares & Mutual Fund Certificates of All Listed Securities* 12,053

Total Number of Shares of All Listed Companies 10,268

Total Number of Certificates of All Listed Mutual Funds 1,775

(No. in ' 000)

Total Number of All Listed Debentures 409

Total Number of All Listed Gov. T-Bonds 4,213

Total Number of All Listed Corporate Bonds 4,336

Total Issued Capital of : (Figure Tk.in mn)

All Listed Securities 646,743

All Companies Shares 201,989

All Mutual Funds 18,066

All Debentures 140

All Listed Govt. T-Bonds 422,213

All Listed Corporate Bonds 4,336

Total Market Capitalization of: (Figure Tk.in mn)

All Listed Securities 3,266,592

All Listed Companies Shares 2,805,511

All Listed Mutual Funds 34,480

All Debentures 576

All Listed Govt. T-Bonds 422,213

All Listed Corporate Bonds 3,812

In CSE, total number of listed companies is 205; total number of Mutual Funds 28 and total
number of Debentures 02 and total market capitalization is Tk. 284937crore.

Annual capital market developments (DSE)

(In crore taka)
Calender Enlisted Issues Issued Capital Market Turnover during General
Year (Incl.Mut-Funds/ and Debentures Capitalisation the Year Index
Deb.)
2004 256 4953.20 22335.90 5318.14 1971.31
2005 286 7031.30 22829.00 6483.55 1677.35
2006 310 11843.70 32336.80 6507.91 1609.51
2007 350 21447.20 75395.50 32286.71 3017.21
 2008 412 37215.60 105953.00 66796.47 2795.34
2009 415 52163.20 188449.30 147530.10 4535.53

Monthly capital market developments(DSE)

(In crore taka)
Month Enlisted issues Issued capital Market Turnover during General
(End Month) (Incl. and debentures capitalisation the month Index
Mut-Funds/Deb.)

August, 09 445 46242.20 132347.30 13431.38 2998.19

September,
446 46333.40 138299.10 8266.37 3016.32
09
October, 09 390 46005.10 146194.70 21050.60 3364.26
November, 09 404 51392.50 183713.90 17981.76 4380.95
December, 09 415 52163.20 188449.30 17926.33 4535.53
January, 10 418 52525.80 217136.80 26286.94 5367.11
February, 10 429 54806.50 226461.70 24998.21 5560.56
March, 10 437 56658.40 227555.80 17511.60 5582.33
April, 10 439 57191.40 234496.90 19130.32 5654.88
May,10 448 59297.00 249929.20 38623.84 6107.81
June, 10 450 60726.30 267096.60 38773.37 6153.68
July, 10 451 61030.50 279368.60 32276.93 6342.76
August, 10 461 62871.30 293978.10 39443.81 6657.97
September,10 463 62702.20 302019.40 31256.24 7097.38
October,10 442 64674.30 326659.20 32089.08 7,957.12

The General index at the end of October, 2010 stood higher at 7957.12 compared to 7097.38 at
the end of September, 2010. Total market capitalisation of all shares and debentures of the listed
securities at the end of October, 2010 also stood higher at Tk. 326659.20 crore, indicating
Tk.24639.8 crore or 8.16 percent higher than Tk.302019.40 crore at the end of September, 2010.
Turnover on the Stock Exchanges

(Tk. In crore)
DSE CSE

2009-10 2008-09 2007-08 2009-10 2008-09 2007-08

Daily Average Turnover 1050.62 373.97 227.32 88.20 52.38 33.40

Monthly Average Turnover 21362.55 7448.25 4527.38 1793.36 1043.19 668.02

Yearly Turnover 256350.55 89378.95 54328.56 21520.36 12518.25 8016.20

The
Turnover on the DSE total

300000

250000

200000

(Tk. In crore) Daily Average Turnover

150000
Monthly Average Turnover
100000 Yearly Turnover

50000
Turnover on the CSE
0
2007-08 2008-09
25000 2009-10

20000

15000
(Tk. In crore) Daily Average Turnover
Monthly Average Turnover
10000
Yearly Turnover

5000

0
2007-08 2008-09 2009-10
turnover on DSE in 2009-10 stood at Tk. 256350.55 crore, compared to that of Tk. 89378.95
crore in 2008-09 showing an increase by 186.81 percent. The total turnover on CSE in 2009-10
was Tk. 21520.36 crore, compared to the total turnover of Tk. 12518.25 crore in 2008-09
showing an increase by 71.91 percent.

Analysis and Interpretation

3.1 Analysis from the frequency distribution table

Analysis and Interpretation

3.1 Analysis from the frequency distribution table

Table 1: Number of Gender in DSE

Gender

Cumulative
Frequency Percent Valid Percent Percent

Valid Male 21 70.0 70.0 70.0

female 9 30.0 30.0 100.0

Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: From above figure here is 70% is male investor and 30% is female investor. that mean female
investor are lagging behind than male investor in stock market.
Table 2:Number of Age in DSE

Age
Frequenc Valid Cumulative
y Percent Percent Percent
Valid 18-30 12 40.0 40.0 40.0
Years
31-40 years 13 43.3 43.3 83.3
41-50 years 1 3.3 3.3 86.7
over 50 4 13.3 13.3 100.0
Total 30 100.0 100.0

Analysis: from above figure most of the investor age is 31- to 40years and the percentage is 43.3%. Here
is some young investor and percentage is 40.00 and the ages are 18-30 years.
Table 2:Number of Occupation in DSE

Occupation
Frequenc Valid Cumulative
y Percent Percent Percent
Valid Business 8 26.7 26.7 26.7
Govt Job 3 10.0 10.0 36.7
Private 11 36.7 36.7 73.3
job
student 5 16.7 16.7 90.0
retired 3 10.0 10.0 100.0
Total 30 100.0 100.0

Analysis: From above figure most of the investor is private job holder. And also some business
man who is invests in stock market. Not only that we also see that here is 16.7% student investor
in the stock market.
Table 3:Number of Education in DSE

Education
Frequenc Valid Cumulative
y Percent Percent Percent
Valid primary 1 3.3 3.3 3.3
S.S.C 1 3.3 3.3 6.7
H.S.C 8 26.7 26.7 33.3
Universi 20 66.7 66.7 100.0
ty
Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: From the above figure we see that most of the investor are higher educated and the
percentage is 66.7%.we can say that above information the investor are know about the stock
market.
Table 4:Number of Longevity in DSE

Longevity
Frequen Valid Cumulativ
cy Percent Percent e Percent
Vali 1 year or 5 16.7 16.7 16.7
d less
2-3 years 8 26.7 26.7 43.3
3-5 8 26.7 26.7 70.0
5 0r more 8 26.7 26.7 96.7
5.0 1 3.3 3.3 100.0
Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: Most of the investor stays with stock market in 3-5 years. It seems to me the investor
details know about the stock market.
Table 5:Number of Investment in DSE

Investment
Frequen Valid Cumulativ
cy Percent Percent e Percent
Vali bank 7 23.3 23.3 23.3
d deposit
gold 5 16.7 16.7 40.0
securities 4 13.3 13.3 53.3
real esate 8 26.7 26.7 80.0
sanchy 6 20.0 20.0 100.0
Patra
Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: People are interested- to invest in

Bank deposit is23.30%
Gold is 16.70
Securities is 13.30%
Real state is26.70%
Sanchay Patra is 20%
Table 6: Number of Purpose in DSE

Purpose

Cumulative
Frequency Percent Valid Percent Percent

Valid for returns better than 13 43.3 43.3 43.3

bank deposit

to make quick profit 6 20.0 20.0 63.3

Savings for future 11 36.7 36.7 100.0

Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: From the above figure we see that most of the investor wants returns better than bank deposit
percentage is 13%, because the investor thinking stock market is better than bank deposits. And we also see that
some investor invest in stock market for saving in future percentage is 11%.
Table 7: Number of Selection in DSE

Selection

Valid Cumulative
Frequency Percent Percent Percent

Valid follow senior investor 5 16.7 16.7 16.7

react to information in 4 13.3 13.3 30.0

the market

analyze the company 2 6.7 6.7 36.7

fundamental

get information from 2 6.7 6.7 43.3

inside the market

all of t he above 17 56.7 56.7 100.0

Total 30 100.0 100.0

Frequency distribution Analysis

Analysis: Most of the Investors are following to senior investor, react to information in the
market analyze, the company fundamental, get information from inside the market. That means
most of the investor follow the above all the selection procedure which share is to buy. And the
percentage is 56.7%.
Table 8: Number of Return in DSE

Return
Cumulative
Frequency Percent Valid Percent Percent

Valid capital gain 9 30.0 30.0 30.0

dividend gain 1 3.3 3.3 33.3

both 20 66.7 66.7 100.0

Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: 30% people want capital gain 03.30% people want dividend gain & 66.70% people
want both of them. That means most of the investor wants capital gain & want dividend gain at
time.
Table 9: Number of Trading in DSE

Trading

Cumulative
Frequency Percent Valid Percent Percent

Valid daily 9 30.0 30.0 30.0

weekly 10 33.3 33.3 63.3

monthly 11 36.7 36.7 100.0

Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: 36.70% investors are trading monthly, 33.30% investors are trading weekly, 30%
investors are trading daily. That means most of the investor follow the market in monthly, and
weekly. The daily trader percentage is not better in position.
Table 10: Number of Decision in DSE

Decision

Cumulative
Frequency Percent Valid Percent Percent

Valid my self 16 53.3 53.3 53.3

breakage firm 1 3.3 3.3 56.7

Relatives and friends 12 36.7 36.7 93.7

professional people 1 6.3 3.3 100.0

Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: Most of the investor takes decision to buy share by myself & percentage is 53.3&.
And follow to friend and relatives & the percentage is 36.7%.
Table 11: Number of Use to in DSE

Use to

Cumulative
Frequency Percent Valid Percent Percent

Valid EPS 9 30.0 30.0 30.0

DPS 1 3.3 3.3 33.3

P/E ratio 2 6.7 6.7 40.0

Market Index 1 3.3 3.3 43.3

All of the above 17 56.7 56.7 100.0

Total 30 100.0 100.0

Frequency distribution Analysis

Analysis: We see that from figure most of the investor follow to EPS, DPS, Market index to buy
share.

Table 12: Number of Strategy in DSE

Strategy
Cumulative
Frequency Percent Valid Percent Percent

Valid Low risk and low 8 26.7 26.7 26.7

return(Risk averse)

Medium risk and medium 4 13.3 13.3 40.0

return

High risk and medium 2 6.7 6.7 46.7

return(Risk seeker)

Low risk and high return 16 53.3 53.3 100.0

Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: Investors are following to Low risk and high return expectation Strategies. They think
to follow Low risk and high return for getting profit from stock market.

Table 13: Number of Report in DSE

Report

Cumulative
Frequency Percent Valid Percent Percent

Valid Yes 22 72.0 72.0 72.0

No 8 28.0 23.3 93.3

Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: Most of the investor read and understand Annual report of the company to make
investment which share is to be buying. The percentage of understand the report is 72%.

Table 14: Number of Argument in DSE

Argument

Cumulative
Frequency Percent Valid Percent Percent

Valid Quite right 4 13.3 13.3 13.3

Its right in most of the time 9 30.0 30.0 43.3

its right some time 8 26.7 26.7 70.0

its not right 9 30.0 30.0 100.0

Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: we see from above gfirure about the irresponsibility & the non-professional attitude of
the companies involved in share market.

Table 14: Number of Attainable in DSE

Attainable

Cumulative
Frequency Percent Valid Percent Percent

Valid Yes 11 36.7 36.7 36.7

No 19 63.3 63.3 100.0

Total 30 100.0 100.0

Frequency Distribution Analysis

Analysis: Most of the investor couldn’t attend the meeting like AGM/EGM of the company.
Because most of the investors are private job holder.

Table 15: Number of Opinion in DSE

 Opinion

Cumulative
Frequency Percent Valid Percent Percent

Valid Highly satisfied 1 3.3 3.3 3.3

Satisfied 3 10.0 10.0 13.3

Frequency
Unsatisfied 17 56.7 56.7 70.0
Distribution
Moderately satisfied 9 30.0 30.0 100.0 Analysis
Total 30 100.0 100.0

Analysis: Satisfaction level of investors is not well, most of the investor is dissatisfied about
current market share. Because the reduce of share price.

3.2 One-Sample T-test

 One-Sample Statistics

N Mean Std. Deviation Std. Error Mean

Gender 30 1.300 .4661 .0851

Age 30 1.900 .9948 .1816

Occupation 30 2.733 1.3113 .2394

Education 30 4.567 .7279 .1329

Longevity 30 2.733 1.1427 .2086

Investment 30 3.233 1.7943 .3276

Purpose 30 2.500 1.3834 .2526

Select 30 3.733 1.6386 .2992

Return 30 2.367 .9279 .1694

Trading 30 2.067 .8277 .1511

Decision 30 1.933 1.0483 .1914

Use to 30 5.400 3.2547 .5942

Strategy 30 2.867 1.3322 .2432

Report 30 1.267 .4498 .0821

Argument 30 2.733 1.0483 .1914

Attainable 30 1.633 .4901 .0895

Opinion 30 3.133 .7303 .1333

 One-Sample Test

Test Value = 0

95% Confidence Interval of the

Difference

t df Sig. (2-tailed) Mean Difference Lower Upper

Gender 15.277 29 .000 1.3000 1.126 1.474

Age 10.461 29 .000 1.9000 1.529 2.271

Occupation 11.417 29 .000 2.7333 2.244 3.223

Education 34.361 29 .000 4.5667 4.295 4.838

Longevity 13.102 29 .000 2.7333 2.307 3.160

Investment 9.870 29 .000 3.2333 2.563 3.903

Purpose 9.898 29 .000 2.5000 1.983 3.017

Select 12.479 29 .000 3.7333 3.121 4.345

Return 13.971 29 .000 2.3667 2.020 2.713

Trading 13.676 29 .000 2.0667 1.758 2.376

Decision 10.102 29 .000 1.9333 1.542 2.325

Use to 9.087 29 .000 5.4000 4.185 6.615

Strategy 11.786 29 .000 2.8667 2.369 3.364

Report 15.425 29 .000 1.2667 1.099 1.435

Argument 14.282 29 .000 2.7333 2.342 3.125

Attainable 18.252 29 .000 1.6333 1.450 1.816

Opinion 23.500 29 .000 3.1333 2.861 3.406

Analysis: Test shows that t value is average of 12, degree of freedom is 29, mean difference is average of

2 and at 95% confidence interval level the lower limit is 1.126 and upper limit is 6.615. Moreover result
shows that 2-tailed significance level is .000 which is highly significant. So, we can say confidently that 95
percent of the intervals similarly constructed would include the population mean. In sample test we
have got mean difference of below 5 which is acceptable that means there is no error in the sample.
FINDINGS

1) There is recent trend of rapid growth of investors in share market. The number of active B/O account
holders doubled in a year to reach 2.8 million in September 2010. This represents increased interest
of general public to capital market.

2) The most participants in the share market is in private job as profession. We see there is a rapid
growth of student investors.

3) Investors make decisions based on rumors in maximum cases instead of analyzing company-specific
fundamentals.

Policy Suggestions

■ The SEC should protect investors' interest and create an efficient market environment for issuers. It
must employ more resourceful, competent and qualified people
Concluding Remarks

The capital market is the engine of growth for an economy, and performs a critical role in acting as an
intermediary between savers and companies seeking additional financing for business expansion.
Vibrant capital is likely to support a robust economy. The capital market in Bangladesh is still
underdeveloped, and its development is vital for full recognition of the country's development is
potential.