The Fundamental Deviation and the Riddle of Manipulation: A Critical Analysis in the Context of Bangladesh Stock Market Crash in 2010-11

Authors

  • Md. Toufique Hossain Dhaka University

DOI:

https://doi.org/10.18034/abr.v4i3.81

Keywords:

Anomalies, Capital market, Fundamentals, Stock market, Structural weakness, Crash, Manipulation

Abstract

The capital market in Bangladesh does not always act based on the fundamentals. Fundamental means the set of ethics, principles, guidance, various market instruments and well structural set up that helps the stock market for operating well. Structural weakness is a thing which may ruin the market base or fundamentals. But the capital market as part of the economy should function based on the fundamental norms, principles and proper rules and regulations. Otherwise, there may be some detrimental effects on the market. Stock market anomalies bring harm not only to destroy market fundamentals but also to spread manipulation inside the stock market. Moreover, the recent stock market crash in 2010-11 was the biggest shock for the 3.3 million innocent and small investors in the capital market of Bangladesh. A section of greedy investors resorted to manipulation at different levels to cash in on the lack of small investors’ proper knowledge about market fundamentals. The excessive fraudulent activities of the unscrupulous manipulators just hastened the fall of the market. So, much of the focus of this study has been put on the causes and consequences of the fundamental deviation and the riddle of manipulation based on the relevant facts and figures.

JEL Classification Code: E44, G10

Downloads

Download data is not yet available.

Author Biography

  • Md. Toufique Hossain, Dhaka University

    Department of Accounting & Information Systems, University of Dhaka, Bangladesh

References

Abdullah MN, Parvez K and Khaled M. 2012. Is the Stock Market Overvalued: A Study in the Context of Bangladesh? Asian Business Review, 1, 30-36.

Aggarwal, Rajesh K., Wu, Guojun.( 2006), The University of Chicago, vol. 79, no. 4, 1-15

Aziz MS and Uddin MN. 2014. Volatility Estimation in the Dhaka Stock Exchange (DSE) returns by Garch Models Asian Business Review, 4, 41-49.

Bepari, M. Khokan. , Mollik , Abu. Bangladesh stock market growing? Key indicators based assessment.

Bhattacharya, D. Rahman, M., Khatun, F., Moazzem, K. G., Iqbal, Md. Ashiq. , Khan, Tawfiqul. Islam, Nabi, Ashiqun. (June 4, 2011). Analytical Review of Bangladesh’s Macroeconomic Performance in Fiscal Year 2011‐12, Second Reading, 45-64.

Bhattacharya, D. Rahman, M., Khatun, F., Moazzem, K. G., Iqbal, Md. Ashiq., Khan, Tawfiqul. Islam., Nabi, Ashiqun. (January 4, 2011). Analytical Review of Bangladesh’s Macroeconomic Performance in Fiscal Year 2011‐12, First Reading, 71-86.

Galbraith, J.K.(2009).The Great crash 1929, Houghton Mifflin Harcourt, Boston, New York, 66-88

Haque, M. S., (n.d.). Recent stock market crash in Bangladesh. [Internet], Available from:< http://www.nub.ac.bd/recent-stock-market-crash-in-bangladesh-wrong-signals-from-responsible-quarters-since-the-ctg-caused-the-asset-price-bubble/>

Hossain M T., 2011. Stock market crashes of 1996 and 2011. [Internet], Available from: http://www.hawker.com.bd/news_details.php?news_id=143942&news_category_id=14&val_lan=

Hossain Md. Toufique, Bangladesh stock market crisis: diagnosis, remedies, prospects, OP-ED, Tuesday, December 27,2011 http://newagebd.com/newspaper1/archive_details.php?date=2011-12-26&nid=44728

Hossain Md. Toufique, Bangladesh stock market: understanding the trends, VOL 21, NO -162 REGD NO DA 1589, http://www.thefinancialexpress-bd.com/old/more.php? news_id=171030&date=2013-05-30.

Hossain Md. Toufique, Dhaka Stock Exchange: panic, fascination and trouble, OP-ED, Wednesday, December 14, 2011 http://archive.thedailystar.net/newDesign/news-details.php?nid=213982

Hossain Md. Toufique, Two bubble-and-bust episodes in capital market, VOL 18, NO -267 REGD NO DA 1589, http://www.thefinancialexpressbd.com/more.php? news_id= 144533&date =2011-07-31.

Huda SN. 2013. Intensifying of Stock Markets (DSE & CSE) in Bangladesh: An Experiment Asian Business Review, 2, 44-50.

Islam Mirza Azizul: Bangladesh scenario: Bubbles and busts, Financial Express, June 26/2014. See http://www.thefinancialexpress-bd.com/2014/06/26/41532/print.

Kindleberger, Charles. P. (5th Edition) Manias, Panics, and Crashes, A History of Financial Crises, 24-63

Ledgerwood. Shaun D., Carpenter. Paul R (DOI: 10.1515/1555-5879.1577). A Framework for the Analysis of Market Manipulation, 1-10

Mansur A., 2010. Is the Bull Market Sustainable? Volume 3 Issue 4, The daily star.[Internet], Available from: http://www.thedailystar.net/forum/2010/april/bull.htm

Maxim MR, Miti TA and Arifuzzaman SM. 2013. Is Dhaka Stock Exchange (DSE) Efficient? A Comparison of Efficiency Before and After the Market Crisis of 2010 Asian Business Review, 3, 78-81.

Rahman J., 2011. Share Market Bubble — the Big Picture. [Internet], Available from: http://dpwriters.wordpress.com/2011/02/04/share-market-bubble-the-big-picture/

Siegel, Jeremy. J., (2003). What is an Asset price bubble? An operational Definition, Vol., 9, 1-5

Websites

Bangladesh Bank, http://www.bangladesh-bank.org/

Central Depository Bangladesh Limited, http://www.cdbl.com.bd/

Chittagong Stock Exchanges, http://www.cse.com.bd/

Dhaka Stock Exchanges, http://www.dsebd.org/

Bangladesh Security and exchange commission, http://www.sec.gov.bd/

--0--

Downloads

Published

2014-12-31

How to Cite

Hossain, M. T. (2014). The Fundamental Deviation and the Riddle of Manipulation: A Critical Analysis in the Context of Bangladesh Stock Market Crash in 2010-11. Asian Business Review, 4(3), 92-99. https://doi.org/10.18034/abr.v4i3.81

Similar Articles

1-10 of 84

You may also start an advanced similarity search for this article.