Objectives

*    Doing a small survey on Bangladesh stock market especially Dhaka Stock Exchange.

*    To have some knowledge about some of the fundamental features of some listed companies of DSE.

*    To measure the systematic risk of the portfolio or security (Beta).

*    Review the behavior of the rate of return on common stocks listed in the DSE.

*    To examine the risk-return relationship for the selected stocks / shares.

*    Finding the correlation of the portfolio to the market index.

*    To clarify whether or not the asset pricing model works in Bangladesh Stock market.

*    To find out whether the stock / share investment in the selected company is attractive or not.


Scope

Through this sample study we can have an overall idea about the risk return relationship of stocks / shares of listed company in DSE as well as the favorability of investment situation of Bangladesh Stock Market. 


Sources of information

*    Web site of Dhaka Stock Exchange to select some listed companies, having some basic information regarding the companies and the industries representing them.

*    We will be collecting the end of month price data of the selected stocks / shares and market index from the daily newspaper called “Prothom Alo”.

*    We will be using our text book as well as the sample report provided by our course tutor as a guideline.


Methodology

*    At first, we will select 5 industries and will take out 10 companies affiliated with those industries that are listed in the Dhaka Stock Exchange.

*    Then we will be collecting the end of month price data of selected companies from daily newspaper, “The Prothom Alo”. Moreover, market index will be collected from the same paper.

*    After that we will calculate the monthly return of each stock from these data using the equation of rate of return on equity.

*    Next we will use R-square to measure the correlation of the portfolio to the market index.


Software Used

Microsoft Excel


Expected Result

Through this research work we will define the risk-return relationship for the selected stocks and the correlation of the portfolio to the market index. So, it will help the investors to decide whether to invest in these stocks or not.