Why the stock market out of fundamentals ? Be careful before your investment

Dec Sun 2021 11:09:10

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Why the stock market out of fundamentals ? Be careful before your investment

Kathmandu. Governor of Nepal Rastra Bank Maha Prasad Adhikari has said that those who invest in the share market lack financial literacy. During a discussion in the Finance Committee on Thursday, the official said that there are more people in the stock market who do not understand than understand, which has increased the risk to the investors.

He also urged the investors to invest in the stock market only after understanding them. Similarly, he said that the Nepal Securities Board, which is the body to watch the share market, should also pay attention to financial literacy.

He also said that the share market is moving away from the fundamentals. "Small investors are reluctant to invest in fundamentals, so the risk is high. Small investors need financial literacy," he said. During the discussion, he said that remittances coming to Nepal come from the informal sector. He said that most of the carriers and informal remittances come from Japan.

Similarly, Finance Secretary Madhu Kumar Marasini said that the current situation should not be taken as a problem. He said that looking at the trend of the last three years, there was a huge upswing earlier this year.

"The Nepse index has gone from 1100 to 1300 directly to 3200 psal. If the NRB had not set a limit of Rs 4/12 crore on margin nature share collateral, there would have been more problems, it is natural," he said.

He also suggested that investors invest only by looking at the condition of the company. "The share prices of companies that have not completed construction and are in debt are rising. There is not much interest in good companies. At least we have to get in the habit of studying," he said.

He also drew the attention of the concerned bodies to put an end to this trend as big investors are playing the game of deceiving small investors and small investors are drowning.