Abstract
Stock market around the world regarded as one of the most dominant indicators of the economic development of a country. Although the economy of Bangladesh grows to ever apex in the year 2019, its capital markets show the worst condition ever and never represent the economic status of the country. Investors lost their confidence and their all rational investment decisions failed to yield capital gains over the years. Thus, the prime objective of this study is to explore the determining factors which instigate the sub-urban investors of Bangladesh in making their investment decisions in the stock market and to investigate the effects of socio-economic variables on the dominant factors. The study has been pursued through a questionnaire survey to collect data from the stock investors of suburban areas of Bangladesh. Principal Component Analysis (PCA) has been used as a factor extraction method. Descriptive statistics, independent-samples t-test, ANOVA, and Post-hoc tests were employed as statistical tools. PCA derived eight factors and fundamental analysis becomes the most dominant factor that affects the suburban investors in making decisions about a stock. Factor analysis also indicated that investment training, technical analysis, investment literacy training, investment consultancy, trade house proximity, insider trading mechanism, macro-economic factors determine investment decisions. Results of inferential statistics revealed that gender difference affects technical analysis; education level has a large effect on investment training and investment length has an effect on fundamental and technical analysis. However, factors do not differ based on investors’ occupational background and investment training. Policymakers should give concentrated effort to stabilize the stock market as the investors are more concerned about fundamental and technical analysis as well as investment literacy. Keywords: Capital Market, Sub-urban Investors, PCA, Fundamental analysis, Socio-economic variables, Bangladesh DOI: 10.7176/EJBM/12-21-07 Publication date: July 31 st 2020
Highlights
Empirical Results and Discussions 4.1 Descriptive statistics of the socio-economic variables: Among the tested samples, 81% were male, and 19% were female. 47% of the investors belong to the age group of 31-40 years, only 10% of the investors were teenagers, 20% were aged 21-30 years; only 23% of them have age more than 40 years. 49% of investors have an undergrad level of education, and 39% of investors have postgraduation levels of education. 5% of investors have Higher Secondary Certificate (HSC), 3% have Secondary School Certificate (SSC), and 4% are below SSC
The frequency of occupational background indicates 31% are from business, 21% from government service, 20% from the agricultural sector, 16% from the private job, and the rest of the 12% are from other jobs. 75% of the investors of the target test had non-certificate training/ no formal training on investment analysis of the stock market, but another 25% have
This study extracted the factors that the investors of sub-urban areas of Bangladesh consider while making their investment decisions in the stock market
Summary
In this mobilization mechanism and financial structure of an economy, the money market and capital market both are very crucial components. Capital Market provides the opportunity to the fund collectors- the companies the opportunity of not getting any fixed contract of repayment of the funds they have collected from the investors/ shareholders through equity share issuance. Capital market research is very crucial; for economic development and for deriving the possible ways to upgrade an emerging market like the Bangladeshi Capital market to an efficient market
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
