Foreign funds in stocks drop 48pc

Net position by foreign investors in Dhaka stocks dropped about 48 percent year-on-year in fiscal 2014-15, as investor enthusiasm waned amid political uncertainty.

Foreign investors bought shares worth around Tk 4,145 crore and sold shares of Tk 2,845 crore, taking their net investment to Tk 1,300 crore last fiscal year, according to data from the Dhaka Stock Exchange.

The net investment in fiscal 2013-14 was Tk 2,493 crore, as investors bought shares worth Tk 3,791 crore and sold shares worth Tk 1,298 crore.

The fall in net position by foreign investors is not a matter of concern and no conclusion should be drawn by analysing the transaction trend, said Md Saifuddin, managing director of IDLC Securities, a stockbroker that deals with foreign investment.

It is natural that foreign investors will not be in the same mood every month or every year, he said.

“They are not leaving the market. They are very positive about the Bangladesh stockmarket,” he said, adding that it is a fact that the overseas investors are still interested in Bangladesh stocks.

Also known as portfolio investment, foreign investment accounts for less than 2 percent of DSE's total market capitalisation, which was Tk 323,947 crore as of yesterday.

Banks are the foreign investors' preferred sector, but non-bank financial institutions, power and energy, pharmaceuticals, multinationals, telecoms and IT also drew their attention.

Investors include Morgan Stanley, JPMorgan, Goldman Sachs and BlackRock, among others.