Some of your Questions:
What is portfolio?
Portfolio means a group of investments. Ideally, the investment should have different patterns of returns over time.
What is portfolio management?
Portfolio management is the professional management of various securities (shares, bonds and other securities) in order to meet specified investment goals for the benefit of the investors.
Who can open a portfolio account?
Any adult (At least 18 years) citizen of Bangladesh, institutions and statutory body can open portfolio account with EBL Investments Limited.
Who will take the investment decisions?
Investor will take the investment decisions in case of Investor’s Discretionary Account (IDA) scheme holder, and in case of Portfolio Manager’s Discretionary Account (PMDA) holder, EBL Investments Limited will take investment decisions on behalf of its clients.
How much margin loan I can take in Investor’s discretionary Account (IDA)?
It will depend on BSEC rules and EBL Investments Limited’s margin policy.
How can an Individual Discretionary Account (IDA) holder place his buy / sell order?
Any IDA account holder place his order through physically submitting the order slip to customer desks or by authenticated email, fax or SMS.
How can I know the status of my IDA portfolio?
An investor can know the status of his portfolio by daily status report sent by EBL Investments Limited through email. Reports can also be received through SMS and login by webmail through EBL Investments Limited website.
What is Margin Call?
In order to protect your equity position, your portfolio manager Calls additional margin deposit in case your equity falls below a certain percentage (the percentage changes from time to time) of your debt obligation to maintain the stipulated debt to equity ratio. Such call is commonly known as “Margin Call”.
Can I place additional deposits?
Yes, you can make additional deposits at any time into your account. Additional deposits will increase your equity position and purchasing power.
What is an Initial Public Offering (IPO)?
An Initial Public Offering (IPO) is the first sell of shares to the public by a company. Through IPO, for the first time the owners of a public limited company give up part of that ownership to the public and become listed to the Stock Exchanges.
What is a Rights Issue?
Rights Issue (RI) is when a listed company proposes to issue fresh securities to its existing shareholders as on a record date. The rights are normally offered in a particular ratio to the number of securities held prior to the issue. This way is best suited for companies who would like to raise capital without diluting stake of its existing shareholders unless they do not intend to subscribe to their entitlements.
What is Bangladesh Securities & Exchange Commission (BSEC)’s role in an Issue?
Any company making a public issue, bond issue or a listed company making a rights issue or repeat public offering is required to file a draft offer document with BSEC for its approval. The company can proceed further on the issue only after getting approval from BSEC.
Does it mean that BSEC recommends an issue?
BSEC does not recommend any issue nor does take any responsibility either for the financial soundness of any scheme or the project for which the issue is proposed to be made or for the correctness of the statements made or opinions expressed in the offer document.
Why companies go public?
A company, which has good financial record goes public to raise capital for financing business plans, capital expenditures, and growth opportunities.
How is the offering price determined?
The price is normally based on the company’s financial statements, income stream, as well as considering the similar share price in the market and current market conditions. The issue manager must determine a fair offering price which takes into consideration the need for the company to raise capital while offering the new issue at a price which represents a fair value of the shares.
What is Bond Issue?
When a company raises capital against a coupon rate by private placement to eligible investors is called bond issue or debt issue through private placement. The advantage of bond issue is the lower coupon rate than bank loan coupon rate.
Who are NRB?
A Bangladeshi citizen living abroad with valid status either as foreign country’s permanent resident or with valid work permit, in case of a foreign passport holder an endorsement either from the relevant Bangladeshi embassy or from Bangladesh foreign ministry stating that “No visa is required” for traveling to Bangladesh – as a proof of dual citizenship.
What are the benefits for Investing as NRB?
Benefits are as follows:
- 10% of all issued IPO are reserved for NRB – may be increased very soon for at least very large issues.
- No capital Gain Tax.
- Can also trade in the secondary capital market while abroad through Nominee in local currency. Availing custodian services for individuals are difficult and expensive. So, investment amount should be transferred either to Nominee or Brokers trading account and then trade on secondary market either by nominee or personally by phone calls, fax, email etc. – remember, the buy sale order will have to be faxed in within 24 hours in account is operated personally.
What is a BO Account?
BO Account stands for Beneficiary Owners Account. This is the account that holds your shares like an inbox holding all your emails. All shares from new IPO's and most of secondary market shares are in electronic form and a BO account, owned by the investor, holds the electronic shares. Any NRB can open a BO account through EBL Investments Limited by filling required forms and submitting required documents.
What is a Trading Account?
- Trading account is an account, with the EBL Investments Limited in which the NRB will deposit his/her initial investment from which the EBL Investments Limited will credit or debit fund for buy/sell
- All earnings from the investment can be first transferred to a local currency account of the NRB and then to the trading account through help of the PoA
- Trading account will allow the NRB to allocate fund for investment in the secondary market
- Sales proceeds will be issued by Account Payee cheque in favor of the NRB Investor. As such a local account or a NITA account is needed.
What is a NITA Account?
Benefits are as follows:
- Non-resident Investment Taka Account (NITA) is an account for channeling foreign currency in as well as repatriation of earnings from investment
- All earnings from investments (e.g. Cash Dividends) are credited to the NITA account
- An audited statement, certifying that all proper taxes are already withheld from the earnings
- Upon issuance of the auditors certificate the earnings can be repatriated to the NRB in foreign currency
- If an investors intention is not to repatriate any foreign currency then NITA account is not mandatory.