Pre- and post- COVID-19 comparative stock return analysis on specific industries in Dhaka Stock Exchange

Abstract

This paper examines the impact of COVID-19 on stock return in jute and telecommunication sectors listed under the Dhaka Stock Exchange (DSEX) in Bangladesh during the period from 3rd January 2016 till 30th September 2021. To measure the impact of COVID-19 on stock return, descriptive statistics and panel data regression model which comprises of Coefficient of Variation and Pearson Correlation Coefficient methods has been used where ROE is the independent variable and Annual Average Return is the dependent variable. All the secondary database is gathered and organized from the Dhaka Stock Exchange (DSEX) archive, annual reports of sector specific companies of jute and telecommunication and other financial websites. To certify the validity of the used framework, Pearson Correlation Coefficient analysis are conducted. During COVID-19 pandemic, the share prices are unpredictable that made the investors insecure on which sector to invest, withdraw and solve the decision-making dilemma as minimal research is examined to support the financial statements. The results disclosed that telecommunication sector is a fruitful investment opportunity during COVID-19 pandemic because Coefficient of Variation is the lowest as well as in Pearson Correlation Coefficient test, it proved that it is moving towards a positive relationship from a negative relationship in between ROE and Annual Average Return. The findings will be helpful for the investors to change, create and design a new optimum portfolio diversification of investments in the long run. In addition to that, there is not much of research done for the jute sector in Bangladesh and hence, this paper will add immense value to the research database in financial literacy.