Ali Bahçuvan/ Economist Questions like “How can İMKB change its image that has been left over from adverse events of thepast? What steps should be taken in this direction?” and their answers are crucial for the health of the stock exchange. And I have conducted some research based on these questions.
Projects for Boosting the Stock Exchange
Ali Bahçuvan/ Economist
Questions like “How can İMKB change its image that has been left over from adverse events of thepast? What steps should be taken in this direction?” and their answers are crucial for the health of the stock exchange. And I have conducted some research based on these questions.
İMKB (Istanbul Stock Exchange) cannot just get rid of the bad image resulting from past events and the sufferings of 400 thousand investors at the stock exchange thereafter, despite high returns it has produced in recent years. Of course, the main reason for this bad image is the failure to make up for grievances at the stock exchange that occurred mainly in the early 2000s and the inability to establish a legal infrastructure to prevent new cases…
I still believe thatwith the new Capital Market Law, serious steps will be taken in this area. I think the new arrangements which are a product of a comprehensive and meticulous work will make quite valuable contributions to capital markets. On the other hand, questions like “How can İMKB change its image that has been left over from adverse events of the past? What steps should be taken in this direction?” and their answers are crucial for the health of the stock exchange. And I have conducted some research based on these questions and tried to find answer to them.
“Investors should be told about the primary purpose of stock exchange”
To begin with, there are some initiatives for raising the awareness of investors, for promoting and protecting them which I believewill be helpful. I suggest we resort to different practices in addition to them. While stock exchanges offer risky instruments, they also provide returns that you cannot obtain anywhere.Investors should be properly told that the primary purpose of stock exchange is to provide resource to economy.
Investors have seen the stock exchange so far only as a place where large companies collect funds. However, the fact that the stock exchange can provide resources also to new entrepreneurs has always been forgotten. I closely follow the Polish stock market because it has launched remarkable and successful initiativesin recent years. At Warsaw Stock Exchange’s “New Connect” market, companies or individuals hold various meetings in order to obtain funds for their projects. After these meetings, some companies or individuals can find partners, get venture capital support, or overcome the obstacles to public offering and go public in this market. İMKB can also create a similar market.
In addition to this, young entrepreneurs with bright projects canget invited to such meetings by receiving support from TÜBİTAK (Scientific and Technological Research Council of Turkey), and KOSGEB (Small and Medium Industry Development Organization). Meetings wouldbe held at İMKB and released to the public through media.News reports about these initiatives in the press will enable the stock exchange’s main function -resource-creation-to come to the forefront.
“PublicOffering Campaign should not be shelved”
It is impossible to think that all companies going public will succeed. Especially the recent SME (small and medium sized enterprises) style public offerings have a high growth potential from one hand and bankruptcy risk on the other hand. Investors should be informed about these risks facing SMEs before it is too late. The Public Offering Campaign should not be shelved because of a few companies going bankrupt.
As TV series industry has become so robust nowadays and exporting to many countries,scriptwriters can be told about the appeal of investing in Turkey either through stock exchange or real estate, or other fields. Turkish TV series are watched in many neighboring countries.It will be helpful to include also information about the stock exchange in TV series.
Performance of the Public Offering Campaign can be improved through a few important changes that have not been paid attention so far.First of all, public offerings by privileged companies should be made difficult, or a commitment about cancelling the privileges after the public offering should be made. On the other hand, the company’s shareholders should pledge to not sell shares or make paid capital increase in the first year following the public offering.
“Possible cooperation with TV series industry”
Many different methods can be used for promoting the stock exchange. For instance, as TV series industry has become so robust nowadays in Turkey and exporting to many countries, scriptwriters can be told about the appeal of investing in Turkey either through stock exchange, or real estate, or other fields. As we all know well, Turkish TV series are watched in many neighboring countries with interest. I believe it will be helpful to include also information about the stock exchange in TV series. Therefore, messages to be given in these productions will reach a wide audience. Stock exchange administration must get together with TV series production teams and hold joint meetings.
The recent absence of criminal and judicial eventsthat alienate investors from the market and the absenceof news about such occurrences in media increase investors’ confidence. Some measures that have been introduced recently and the new capital market law will further reduce the number of criminal and judicial events and help increase investors’ confidence.