30 May Wall Street 2.0
“Wall Street 2.0” was an elucidative virtual session executed as a collaborative initiative by the Rotaract clubs of Central Campus and University of Colombo, Faculty of Management and Finance with the prominent motive of scrutinizing the Stock market of Sri Lanka. Semantic explanations were well defined as the context of the session best illustrated the practical setting of Colombo Stock Exchange (CSE). The session was streamed via Zoom on 8th of May 2021 and facilitated by the orator- Mr. Madhawa Aramandeniya, Executive, Marketing division Colombo Stock Exchange and moderated by the Director of Professional Development of Central Campus - Rtr. Saif Anverdeen.
In the prefatory of the webinar Mr. Aramandeniya explained the meaning of stock exchange in order to prepare the ground to the discussion. Parallel to the beginning he went on explicating the substances of Stock exchange where it described the basic typology of company; listed companies which have the ability to involve in stock exchange activities. After giving an insight of each of above elements, the session moved into explaining the meaning of shares as it is one of the prime element in Stock exchange. Accompanying that, the composition of regulatory framework of the stock exchange was step by step amplified. Each authority within the structure and each subsidiary within that authority was well defined by Mr. Aramandeniya. Accordingly, he illustrated the framework starting off with the Ministry of Finance which has two subsidiaries of money and capital markets. Securities and Exchange Commission which came under those subsidiaries and finally to Colombo Stock Exchange which contains Broker firms, listed companies and investors.
With the precise understanding about shares and Stock Exchange, the discussion then directed toward “How to invest in stocks?” highlighting the procedure of buying shares where Mr. Aramandeniya outlined the distinction between Primary market and Secondary market by emphasizing the assigned functions of each market. Thereafter, the session escalated into an in- depth discussion about opening a CDS account which happened to be the basic requirement that individual and institutional investors in need to fulfill. Thereby he distinguished the different ways of opening a CDS account, physical way and digital way. In the physical process, the investor has to meet the stockbroker and fill all applications and other documentation along with providing identification, proof of address, copy of bank passbook and email address. His explanation on digital way was able to spread the awareness on opening an account in the CDS by using a mobile application where each step was exhibited on slides which demonstrated the interface clearly.
Following the informative chapter on the share market, he moved the subject towards the types of securities in the market. Mr.Aramandeniya stated 7 types including ordinary shares, preference shares, corporate bonds, treasury bills, treasury bonds, and share warrants. Then he kept delve into the most important type among those which is ordinary shares. Ordinary shareholders are entitled to be the owners of the company along with many other benefits while preference shareholders are not allowed to be the owners. According to his elaboration, ordinary shares are in two varieties as voting and non-voting. Moreover, he included the difference between those two. Mr. Aramandeniya carried the session into a more pragmatic exposure by taking numerous industrial examples of share prices and benefits.
His clarification on the Central Depository System cleared many doubts and concerns in our minds as potential investors. The Central Depository System (PVT) Limited is wholly own subsidiary of the Colombo Stock Exchange which is frequently controlled by the administration. It is recognized as the essence of the Colombo Stock Exchange which secures invested shares on behalf of them. Its functions can be categorized into three core avenues as depository operations, post-trade settlements, and cooperate solutions. Mr.Aramandeniya was clear enough about the functions and the objectives of a stockbroker. As per his display, they are obliged to provide us investing advice regarding future projections. Afterwards, he drew our attention towards the share transaction process with a graphical illustration and explained how we can automate the process through the mobile application. Mr.Aramandeniya's fascinating explanation on the extensive benefits of investing lifted our enthusiasm to a greater extent. Dividend, Capitalization of the reserve, capital gains, tax relief, and ownership are a few of them.
As the final section of the presentation, he led the way into few updated graphs on interest rates with the effect of inflation in few growing sectors in Sri Lanka. The graphs showed considerable fluctuations of the gains of those investments through the years. Hence, his advice was to diversify the investment in a portfolio that consists of both physical and money market investment to manage risk and secure returns. He concluded the presentation with a popular statement about portfolio management by Warren Buffett '' Don't put all your eggs in one bucket''.
The question-and-answer session revealed how excited the future investors were. Many participants raised questions and Mr.Aramandeniya was able to vanish every concern with his clear on point explanations.
Towards the end, it was the time for the most awaited session. Everyone was eagerly waiting to be the "Wolf of the Wall Street". After an interesting Kahoot session, S.H.Wickramaarachchi was announced as the "Wolf of the Wall Street'' and awarded with an e -certificate. After the richly informative session, Rtr Udeshi Ganegoda delivered the vote of thanks showing our gratitude as a team towards the exert personality, Mr. Aramandeniya and to all who offered their helping hand to make this event a grand success.
Eventually, we were highly delighted with so much positive feedback on the session which was the ultimate proof that one and a half hours were truly fruitful.
Written By –
Rtr. Senari Nadugala
Written By –
Rtr. Dulmini Fernando
Edited By –
Rtr. Sahani Jayamaha
(Blog Team Member- 2020/21)