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Stock Movement

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Submitted By rezaulnsu2
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Chapter 3

Enquiry into Stock Price Movement

In this chapter we shall concentrate on daily stock price movement during April, 2010-April, 2011. The stock price is driven by various external and internal factors that can be a macroeconomic variable as well as company specific variable. Here, we shall try to figure out main driving factors, i.e corporate decisions, dse decisions.

Specially, we shall try to figure out corporate decisions like Dividend declaration, Account closing, EPS, Retention, Capital structure decision, Marketing etc that are responsible for a remarkable fluctuation in stock price movement.

Share Price Movement for the year of April 2010 to April 2011:

[pic]

Figure-17: Stock Price movement of Sonargaon Textiles for the year, April 2010 to April 2011

Comment:

As we see above that stock price of Sonargaon Textiles had been rising continuously since beginning of May 2010 and it continued till beginning of December where the greater rise was during October to December. The stock prices started to move down after mid of December and it is stable at a low level now.

Our motto will be to identify possible corporate decisions that have influenced investors in decision making during the fluctuation time. DSE inquiry tells us that there was no sensitive price information that was undisclosed for the price hike that we see.

We can look into some corporate decision over few months. 15th July 2010 company was place in “A” category from “B” category. 29th July 2010 an unaudited account for Jan to June shows EPS 8.96 comparing to 2.64 for the same period of previous year. 24th October 2010 Company’s board of directors took decision of denomination of share price from Tk. 100 to Tk. 10 and took decision of raising fund through issuing right share. With a view of increasing production capacity anticipating future demand the capital was

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