Barriers to the Development of Bangladesh Capital Market

Full Text	Pdf
Author	Dr. M. Serajur Rasul
ISSN	2307-2466
On Pages	392-402
Volume No.	2
Issue No.	6
Issue Date	October 01, 2020
Publishing Date	October 01, 2020
Keywords	Bangladesh capital market, stock market problems, stock market development, Dhaka stock exchange, Securities and Exchange Commission

Abstract

A successful stock market in a developing economy can provides a major source of financial development both by channelling domestic savings and attracting foreign investment. However, this objective is not always met, particularly in underdeveloped stock markets due to underlying some problems of the capital market. A study of Dhaka Stock Exchange during the period of 2000 to 2009 illustrates some problems like small size of the market, low and unstable liquidity, small listing, high concentration, low foreign portfolio investment and integration, weak regulatory frame work, lagging development of bond market, absence of demutualisation, information asymmetry so on. These are the major hindrances of sustainable and developed stock market in Bangladesh. Without sound and efficient capital market, rapid economic development could be hampered as capital market provides long term funds to entrepreneurs. Further, the capital market Bangladesh is still underdeveloped, in spite of recent initiatives. Thus the study provides a number of suggestions that will help towards a stable and developed stock market in Bangladesh. However, the government is making efforts to develop the reliability and efficiency of stock exchanges as investment market.

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