The Dhaka Stock Exchange’s market capitalisation is now a respectable Tk 342,570 crore, so one would think a raft of stock market data analysis providers would have set up shop in the last few years.
But the reality is rather different: only two companies, Amarstock and Stock Bangladesh, are providing technical and fundamental analysis to about 25.78 lakh beneficiary owners account holders and their yearly revenue is still less than Tk 1 crore.
“This is because, investors mostly have no faith in the market. Whoever has faith are looking forward to gambling with stocks,” said Ali Xahangir, chief executive officer of amarstock.com.
But it is a universally acknowledged fact that investors will have to conduct technical and fundamental analysis to be a profitable stock investor in the long-run, he said.
In India, around 20 companies are providing such due diligence and most of their retail investors defer to their expertise for their investment decisions.
“Young investors are gradually coming to us and our visitors are rising,” he said, adding that the tool providers have huge potential in the coming years like in other countries.
Amarstock, which built in 2017 as a start-up, has 55,000 unique monthly visitors now. Of them, 60 per cent is aged between 25 and 35 years.
“There is a huge potential,” Xahangir said, adding that foreign investors are showing keen interest.
ASM Sohail, managing director and founder of Stock Bangladesh, which pioneered the business in 2007, said they had many plans to provide modern data analysis but they had to stop due to fund crisis.
Analysis tool providers are struggling because the stock market itself is struggling most of the time.
“We had a number of free training services, which we had to shut for fund crisis,” he said.
Stock Bangladesh was a data partner of Bloomberg. “But Bloomberg terminated the agreement,” he said, adding that the termination sent Stock Bangladesh into further financial hardship.
Some leading institutional investors are also doing technical and fundamental analysis for their investors. But those are not open for all.
The main users of stock market data are institutes, according to Md. Moniruzzaman, managing director of IDLC Investments.
Currently, IDLC relies on the DSE for fundamental data and free web portals for charting and technical analysis tools. There is a younger breed of technical analysts who use third-party software but feed the data manually, he said.
“I think the free portals are doing a remarkable job in providing charting tools.”
But the service providers must be able to lift their aptitude to world-class standards like Google Finance for institutes to find it worthy to be a paying subscriber.
There can be some value-added services based on company and industry research and market data too, Moniruzzaman added.
But, investors are realising that fundamental and technical analysis is necessary to achieve above-average returns from the markets, Sohail said.
Amarstock is planning to roll out a mobile app to draw in more paying users, Xahangir said. Moreover, the company has plans to create analysis-based tools for India and Sri Lanka. It has already started a separate analytical tool webpage for Nepal.
“However, we need investment for it,” he said, adding that Amarstock is delivering research and data services to brokerage firms in Bangladesh.