The daily turnover of the Chittagong Stock Exchange (CSE) on Sunday surpassed the one of the Dhaka Stock Exchange (DSE) for the third time.
Increased block market transaction amid anaemic public trading due to the existing floor pricing method led to this.
"We have some better offers to host large transactions. Relationship marketing also helped us attract some clients of our brokerage firms," the CSE Managing Director Mamun Ur-Rashid said.
As the stock market reopened on May 31, after two-month-long nationwide general holidays, the CSE defeated the premier bourse on June 9 and 25 and yesterday.
The DSE brokers executed trade orders worth Tk73.4 crore in the opening session of the week and the CSE member firms Tk89.33 crore.
Of the DSE transactions, the block market contributed to less than 15 percent.
However, at the CSE over 95 percent turnover came from the block market – where the buyers and sellers executed their previously agreed deal, bypassing the bidding and asking process in the public market.
Of the CSE block trades, a foreign transaction of British American Tobacco Bangladesh's shares constituted almost the whole part.
For each transaction, the CSE charges its brokers 0.023 percent of the turnover value which comes down to 0.004 percent in case of bulk transactions – as large as Tk50 lakh – in a single trade.
Also, the bourse has a foreign trading window in its system to attract transactions where foreign investors are either on the buy or sell side or both.
Meanwhile, the DSE charges 0.025 percent of the turnover value as an exchange fee and for block transactions it charges Tk50 against each trade.
The CSE is now desperate to increase trading in its platform and regain market share which went down below 5 percent in recent years.
The port-city bourse began its journey in the mid-1990s to compete with the DSE which was born in the mid-1950s.
The CSE was trading 30-50 percent of what the DSE would until the early 2000s and sometimes it went as high as the DSE's, former CSE managing director Wali-Ul-Maroof Matin said.
However, the exchange began to lose the edge in the mid-2000s as the capital market regulator had stopped intraday trading facility which, only, the CSE would offer.
The rest is a story of a vicious cycle of low order flow, low liquidity and presence of fewer investors.
Despite its ahead-of-time offers of modern facilities like internet trading, the CSE is struggling to get its fair share from daily stock market turnover.
However, in recent years it became a profit-making exchange company.
Through running campaigns among brokers, it has gained more investors' response in terms of placing buy and sell orders and getting a larger portion of those executed.
Meanwhile, after demutualisation, the exchange is looking for a strategic partnership with any world-class stock exchange group which can add value, capital and image as a modern stock exchange.
Some international investor groups had been in talks with the exchange in recent years.