Top Frequently Asked Questions on Stock Market

Introduction

The Stock Market is a very challenging and risky industry. If you are a beginner, there are certain things that you must know before entering the market. If you invest money without proper research and knowledge, it could cost you a fortune. You need to know certain things, before investing. 

We would like to mention to you the top 10 frequently asked questions on the Stock Market. These questions will make a better understanding for you so that you don’t have to face any certain loss on investment and also help you make your journey much investment-friendly.  

What is The Beneficiary Owner’s Account?

The Beneficiary Owners Account (BO Account) is an account that is used to keep track of your shares. Opening a BO account is the first step in landing in the stock market of Bangladesh. All new IPO shares and the majority of secondary market shares are issued in electronic form. To draw a simpler picture, we can compare a BO account with a Bank account.

A bank account gives you a summary of your transactions, you can deposit and withdraw funds, know your bank account balance, and so on, In the case of a BO Account, it is used for the transaction of shares in the stock market. Using your BO account number, you can deposit and withdraw cash from the BO account using the linked bank account. A BO account is of three (3) types, one is single, the second is a joint account and the third can be opened by a company name. 

What is an IPO?

Initial Public Offering (IPO) is a process of a company raising money from offering ownership of that company by selling its share/s to the public through listing on the Stock Exchange of Bangladesh. Imagine, there is a new company in the block and it is not enlisted in the share market. Meaning, you cannot buy or sell shares of that particular company in the share market. In order to ensure the stock market, a company has to be enlisted in the stock market, to begin with. One of the processes of getting started in the stock market as a company is to issue public shares of the company that the investors can purchase. 

The method of selling shares of a private company to the public in a new stock offering is known as an Initial Public Offering (IPO). This is a gateway for the company to set foot on the stock market by selling shares to the investors. By selling these shares a company can gather a good amount of capital from the market.  A business may collect capital from the general public by issuing public shares. Once the investors have the shares of the company, they can start buying and selling the shares on the stock market after the company resumes trading. 

How Do I Open an Online BO Account?

As we have discussed earlier, opening a BO account is the door opening of investing in the stock market. While few brokerage houses in the market are offering this online service, RCL is giving you the privilege to open an online BO account with 4 easy steps. Grab a coffee, sit and relax, get a chair beside your lawn or veranda, click the below link, follow some simple instructions and get your online BO account done. Please visit royalcapitalbd.com

Before you join any broker house, there are a few components you must check before selecting the broker house. There are many broker houses providing this service. With Royal Capital, you can open a BO account online in no time. If you are wondering how to open an online BO account? Let’s have a look at the simple steps below on this step-by-step guide. 

What Kind of Stocks Should be Avoided for Investment?

The stock market is very dynamic. There is not any thumb rule for success and profitability in the market. However, there are some indicators that show how well a company is performing and predict how it might perform in the long run. These indicators can be considered as your lighthouse to guide you on which company to invest in and which to avoid. In the following, we will summarize a few of the basic indicators of stocks that should be avoided. 

• Liquidity: When you are looking for a company to invest in, it’s a must to check whether that company has enough liquidity in its hands. You’ll need buyers and sellers so that if you decide to sell the stock, you’ll have someone to buy it. Low-liquidity companies are unable to provide this. Such businesses clearly do not pique curiosity, owing to the fact that they are struggling and it might cause the investors in the long run. 
• High Debt: You should also consider avoiding companies with high debt and low visibility. In some cases, having a higher debt does not turn out to be good in the long run. 
• Gradual Low Performance: The track record of any company is an essential indicator for investment. If you notice a gradual declining trend in the performance of any organization, it is better to reconsider the decision of investing in that particular company. This is another indicator you can use to determine which stocks to avoid. 
• Market Condition: If the overall market condition of a specific industry is on the fall, it is obvious it will have its aftermath on the other companies as well. So if you see the industry is struggling it is better not to set foot on a sinking ship. 

Who Can Apply For an IPO?

Any person who is 18 years of age with Bangladeshi citizenship and has a BO account can apply for IPO. To know the process of how to open a BO account with Royal Capital Limited click here.

How Can One Apply for an IPO?

IPO can be applied in various ways in different brokerage houses in Bangladesh. In Royal Capital Limited, the IPO application process is very simple and straightforward. You don’t need to come to any RCL branch office for applying for an IPO since all IPO application processes can be done online. Besides, IPO can be applied through SMS, Web, Mobile app, or attending the RCL branch office.

Who Can be a Nominee?

The nominee of your account is the person who will be the beneficiary of the account after your death. Anyone can be the nominee of the account but if he/she is under 18 years, then you must appoint the guardian of the nominee. There is also a provision to state two persons as nominees where the percentage can be adjusted separately for each one

What are The Essential Documents for Opening a BO Account?

If you’re opening a BO account, you’ll need the following documents. Not all of these specifications are right, as they vary from one broker to another. You’ll need 3 copies of the account holder’s passport-size photo and 2 copies of the account holder’s nominee’s passport-size photo. Bank certificate/deposit slip for the account holder. A recent photocopy of your NID/ Driving license or passport copy is needed. If you are a non-resident Bangladeshi, you will need an agreement paper on the operation, a copy of your residency permit or visa (for NRB), and confirmation of your foreign currency bank account (for NRB). Beneficiary 

How Can You Get Your IPO Result? 

Your IPO results are now available online. Get all IPO results in one spot. The Process is faster and quicker, It is accessible to all, and the results are at your fingertips.  You can know about the IPO results easily from Royal Capital Ltd’s website. Irrespective of your broker house, you can know about the IPO results of any company from this platform easily. 

How Can You Deposit/withdraw Money from Your Account?

It’s easy to deposit money into your BO account. You have the choice of making an online or physical deposit. You can also use mobile payment gateway services. Withdrawing funds from your account have never been simpler. If you have a bank account with any of the listed banks, your money will be deposited directly into your account. As a result, the whole procedure is completed online, and you can deposit or withdraw funds from your account without ever having to visit our office.

Conclusion

In the end, all you have to keep in mind is that the share market is always changing. To keep up with the ever-changing dynamic of the share market, there is no alternative to keep yourself updated. Knowing the latest news, having ideas of different investment theories and approaches, etc. are required to sustain in the stock market. You must also keep in mind that these are not all the questions, rather this is just the tip of the iceberg. For more informative articles like this visit our website.