A Relationship between Market Capitalization with Market Turnover to Find the Probable Cause and Signs for Debacles in Bangladesh

Yealiza Kaleque Kheya, Md Mamunur Rashid, Shuriya Parvin

Abstract:

Bangladesh's capital markets are largely regulated by the Government of Bangladesh. The goals of this study are to identify the root causes of the crash and failure including overview of the capital market, its structure, functioning, and relevance; to learn about the current state of Bangladesh's capital market, to resolve the difficulties that our capital market presents to provide some feasible remedies to these issues. Also reviewing the market trend after the crash and by an ANOVA analysis, the causes and effects of the crash was demonstrated. By running the regression and ANOVA model, we came to know that both market capitalization and Market Turnover move with each other and have a significant relationship with each other. Also, most of our investors do not invest understanding the market but in other people's opinions. As a result, they miss these signs and become the victims of terrible debacles like 1996 or 2010.Through an in depth causes and effect analysis, the reasons became clear for these crashes. Gambling, issuance of right share, omnibus account, suspicious transactions from top level and ignorance from the regularity authority which caused sufferings for small and general investors. In this perspective, a relationship has been developed between market capitalization with market turnover to find the probable cause and signs for debacles in Bangladesh.

Keywords:

Bubble, Capitalization, Crash, Debacle, DSE, Economic development, Trickster

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