The old key index of the Dhaka Stock Exchange, DGEN, which was there for 12 years, will not be shown at the bourse’s web site from today as many investors found it confusing and providing misleading information.
The DSE board took the decision on July 22 following a verbal direction from the Bangladesh Securities and Exchange Commission. The DSE on January 28 introduced two new indices — DSEX and DS30 — on the basis of free-float method developed by the Standard
and Poor’s.
The DSE then said that the DGEN would be replaced by the DSEX after three months when the investors would become familiar with the new index.
However, later the bourse decided to keep it for another three months.
The decision to withdraw the index came after the DGEN on July 18 and July 21 had showed that the market fell way more than the DSEX. DSEX had lost 194.11 points on those days in total, but DGEN showed the fall was 348.96 points.
Following the incident, amid protests from the investors, the BSEC verbally asked the DSE to stop showing the index on the bourse’s web site.
‘We have decided to stop showing the DGEN on the DSE web site from August 1 as the index provides misleading information about the market,’ DSE president Ahsanul Islam told New Age after the board had decided to remove the index.
The flawed computation of the index first came to light following the debut of Grameenphone on the stock market in November 2009 when the then key index of the bourse, DGEN, gained more than 700 points in a single day.
A Bangladesh Securities and Exchange Commission committee in 2010 proposed that the DSE should introduce free-floating index to remove the flaws in the calculation process.
The DSE had introduced the DGEN on the bourse in 2001 with the base of 817 points while it finished at 4,342.31 points on Wednesday, its last day on the bourse.
DSE officials said they would now provide five years’ data of the DSEX and DS30 indices for the better understanding of the investors.
-With New Age input
