You are here
Home > Interview > Leadership > ‘INVESTING IN THE STOCK MARKET IS LIKE DRIVING A SPEEDY VEHICLE ON AN EXPRESSWAY’

‘INVESTING IN THE STOCK MARKET IS LIKE DRIVING A SPEEDY VEHICLE ON AN EXPRESSWAY’


Captain M. Moazzam Hossain was born on  01 June 1961 and started his career with Bangladesh Navy as Officer Cadet and within very shortest time he was recognized as an outstanding commissioned officer of BM. Later he joined merchant fleet and attained further professional qualification as master class 1 degree from Australia and also an FCIT from UK. He is a successful entrepreneur, industrialist, a businessman whose business interest has been successfully diversified mainly in marine transport, Investment, stock brokerage, financial sector and Real Estate Development. Captain Moazzam is the Chairman of Canadian Trillinium School, Ekushey Homes Ltd., Agrovita Ltd., E-Securities Ltd., Ucas Ltd., Radiant Dredging Ltd., Great Walls Land Property Ltd. Also Director of Shoppers World Ltd., Master Ocean Voyage, Athena Venture & Equity Limited, Paramount Properties Ltd., Sonar Bangla Insurance Ltd., and South Bangla Agriculture & Commerce Bank Ltd.


Being inside a room with a capital market maestro and a hugely successful businessman usually entails an ‘arithmetical’ ambience. Conversations flow in staccatos and imperatives; numbers fly around. Not with Captain M Moazzam Hossain though.

Yes, this pentagenarian former ‘man in uniform’ turned entrepreneur would tell you about his business, and if in mood, perhaps would provide you with great insight to the capital market too. But the text of a discourse with him frequently enters into the arena of philosophy as he loves to see himself as a lifelong student of the ‘school of life’.

For him doing business, making great investments, striking great deals or incurring huge losses-all are just mere course works that he needs to complete. The philosopher inside him however comes out when he tells you that he doesn’t know how to graduate from that ‘school of life’ and how to attain ‘true successes.’

On a sunny Monday morning, while having a conversation with him over a cup of tea, he admonished me for calling him ‘successful’. I was taken aback since to my brain, which is engulfed by numbers, the fact that Captain Moazzam is the chairman of three successful companies and director of another eight, was good enough to scan him as ‘successful’ person.

“Success doesn’t only refer to financial success,” he said adding that financial success, on a holistic level, is about more than just accumulating money and being financially stable. The desire to achieve financial success is universal, but the way to accomplish it is unique to every individual. Identifying your objectives and creating the path to achieve them takes time and patience.”

He said that success, for most of us, fosters a sense of well-being and peace-of-mind. “Yes, financial success sometimes ease the way of attaining that sense but setting goals on the foundation of what is important to you and your family is of paramount importance.”

Captain Moazzam of course is a family man. A good number of years of service in Navy have taught him to maintain a work-life balance with near-military precision. It has also taught him values and the importance of upholding integrity even in the most difficult situation.

He has passed those eruditions to his three sons-one barrister from UK, another one studying bar-at law there and the youngest one-dreaming of becoming a footballer-while getting straight A’s in the college in UK.

“I taught them the importance of morality and significance of being true to oneself,” he said.

He has strong notion of those since he has been a lifelong practitioner of those. Perhaps, because of that, he had been searching for his soul’s solace and switching from one career to another for a significant part of his life.

After finishing intermediate exam, he got enrolled in Dhaka Medical College to become a doctor. He however discontinued medical studies and opted to join Bangladesh NAVY as an officer cadet.

Later he was sent to Germany for higher study and training. While staying there, the philosopher inside him woke up. He was surprised to find out the hypocritical stance of the supposed ‘civilized’ western world.

He saw that while the European policymakers vehemently talked about protecting environment, but at the same time, led the industrializations and sold arms in third world countries not just for monetary benefits but also for exerting political influence.

After finishing the training, he came to Bangladesh with a mixed feeling for western philosophy and to some extent a ‘confused aim in life for a while. “I resumed my duty in Navy but pretty soon I started to feel like a caged bird. I took release from the Navy and joined Bangladesh Shipping corporations. Within a short time, I started my own shipping business and cargo handling business.”

He also started investing in the stock market. It was in the entrepreneurship and investment where Captain Moazzam found his mojo.

“Doing business and making investments have their own charms and because of those people opt for entrepreneurship. A salaried person can shut work off the second they leave the office. As an entrepreneur, the success of the business becomes part of your identity, and you bring that with you wherever you go.”

He said that making investment in the stock market is a ‘decision’ that shouldn’t be made in a whimsical manner. “First of all, you have to understand that without having actual knowledge about the whole scenario, you will not be able to make wise investment.”

Too many people are seduced by the get-rich-quick dream. “They jump in, taking on high level of risks without gaining proper knowledge, and taking on high risk often a precisely the wrong times. They end up losing.”

The fact is, he said, it takes some acceptance of uncertainty and comfort with not knowing in order to learn and to be open to new knowledge. “We come into the world with limited knowledge about what kind of consequences we will experience after making decisions and also about how likely these different outcomes are.”

Knowing ‘something’ is generally better than ‘nothing’, he said, but it is crucial in the stock market that individual investors have a clear understanding of what they are doing with their money. “It’s those investors who really do their homework they succeed.”

Captain Moazzam said that to make intelligent investment in the stock market of Bangladesh, an investor first has to get his vision straight. “An investor needs to understand that investing in the stock market here is like driving a car at 200km/hour on an expressway. You need to know driving and have the nerve of speed driving. The margin of error is very few here.”

“Assessing the value of a company isn’t an easy practice. There are so many variables involved that the short-term price movements appear to be random, however, over the long term, a company is only worth the present value of the profits it will make.”

Captain Moazzam said that there is hardly any denying fact that Bangladesh’s stock market is an exclusive club in which only large brokers and rich people make money. “Interestingly they make money with the ones invested by the small traders as they don’t invest wisely.”

“The fact is, when you are personally buying stocks in the market, you are competing against large mutual funds and institutional investors that not only do this full-time, they also do this with far more resources and in-depth information than the average person has.”

So, he said, when a newbie starts to invest, it is best to start small and take the risks with money he is prepared to lose – the market can be unforgiving to rookie mistakes. As that person becomes more adept at evaluating stocks, you can start making bigger investments.

“In my opinion, a prudent investment philosophy utilizes low-cost investments across a mix of asset classes to create a diversified portfolio. This portfolio is engineered to provide long-term returns and offer reasonable down-side protection.”

Lauding the modernization and digitalization of the Dhaka Stock Exchange (DSE) as well as Chittagong Stock Exchange (CSE), Captain Moazzam said, the usage of technology has been able to bring some sort of transparency in trading there.

He however said that full benefit of the technological up gradation of the bourses would come if ‘old school’ leaders and policymakers there create more space for young minds to take decision. “The youth of these days are more dynamic and proficient with technological changes that are happening around. I think it’s time to pass the mantle to them.”

The seasoned investor also said the same for the country’s banking sector, which too has been ruled and run by ‘old school’ thinkers who are yet to put themselves in the fast pace lane of technological changes.

Captain Moazzam is aware of what is happening in the banking sector because he is a board member of South Bangla Agriculture & Commerce Bank Ltd and he also holds the incumbency of the Chairman of the audit committee there.

He said that his bank is trying to break the shackles of age old system and try to adopt with the technological disruption which is looming. “I wouldn’t say that we are completely successful in achieving that but we are trying. Some other local banks including Eastern Bank Ltd, City Bank Ltd, Brac Bank and Mutual Trust Bank (MTB) have made significant success in those areas.”

About the dwindling interest rate and people’s jittery in considering FDR as saving and investing option, he said those phenomena prove that time has come for the banks diversify their products also stave themselves off further from traditional banking.

“The banks have to be innovative; they have to create products with specific purposes. They have to focus more on equity rather than interest income. Admitting that the country’s banks still have problem in thinking of equity based model, he said that because of this, there should have been more scope of investments like venture capital (VC) firms.

“VC firms can invest in areas which other traditional banks feel too risky to invest and that are the beauty of it. This is because the VC firms run on equity based model and since they share the responsibility of both profit and loss, the entrepreneurs on which they invest feels a certain level of motivation to grow their business.”

He said that if the venture capital firm culture is grown in the country, then scopes will be created to venture in avenues which are still unexplored. “They can even invest on carpenters. Just think about a business model-a group of talented carpenters is financed by VC firm to open a furniture business. Individually, those carpenters wouldn’t have been able to accumulate enough money to start their own furniture business but as they now get the financial backing from a VC firm, they can start it.”

“That’s not all. Like banks, VC firms just don’t give money to do business, they also provide guidance since they share the profit or loss in equity basis. May be later, when that furniture business grows, the VC firm can help it to grow further by facilitating the initial public offering (IPO) for that furniture business.”

“All you need is imagination and vision. Without those two, you cannot make good investments,” said the man who has successfully been using those for the most part of his life.

 

 

Leave a Reply

Top