What Are First Liner Shares? Get To Know The Differences With Second Liner And Third Liner

Illustration of first liner shares (Photo: Doc. Antara)

YOGYAKARTA In stock investment, novice investors tend to play safe by buying first liner shares on the Indonesia Stock Exchange (IDX). Unlike second liner and third liner shares, first liner shares are included in the leading stock category because they are inhabited by blue chip issuers.

So, what are first liner stocks? what's the difference between second liner and third liner shares? The following article will explore first liner shares on the IDX and the difference between second liner and third liner shares.

Quoted by VOI from the IDX Channel page, the stock category based on its layer is classified into three levels, including the first liner, second liner, and third liner.

Each stock level has different characteristics and can be a reference for investors to adjust to the risk profile of their investments.

Please note, the terms first liner, second liner, and third liner are not from the IDX. However, the designation is often used among investors.

First liner shares are superior stocks on the IDX inhabited by blue chip category issuers. Shares that fall into this category have a large volume and market capitalization, which is above IDR 10 trillion.

In addition, layer one shares are also diligent in distributing dividends every year regularly.

Shares that fall into the first liner category are usually identical to issuers that are included in the LQ45 index that has been set by the IDX.

First liner shares can be the right choice in investing. The reason is, most blue chip stocks have good liquidity.

Even so, first liner stocks are not recommended for traders (investors who trade investment instruments in a short time), because these stocks have a low level of fluctuation.

First Liner's Share Differences with Second Liner and Third Liner

If the first liner shares are inhabited by blue chip issuers, the second liner shares are the second tier shares of the middle-large company.

Shares that fall into the second liner category have a medium market capitalization, which is IDR 500 billion to IDR 10 trillion.

The price of second-tier shares tends to fluctuate more than the shares of blue chip issuers. This happens because the market capitalization rate is lower. Even so, second liner shares are still quite liquid.

Second liner stocks are preferred by traders because they are more volatile in trading, both swing and super trading. In addition, the stock price of this category is also cheaper than the blue chip shares which fall into the first liner category.

Meanwhile, the third liner shares are stocks whose market capitalization is below IDR 500 billion. Investors refer to the shares in this category as fried food stocks.

Because the market capitalization is low, the movement of stock prices in this category is also very volatile. In fact, only with a transaction of IDR 1 billion, the stock price in this third liner category can move not wildly.

Shares that fall into this category tend to be avoided by investors. THird liner stocks are usually hunted by traders who have a high and aggressive level of risk tolerance.

This is information about first liner shares and their difference with second liner and third liner shares. What is first liner stock? First liner shares are the leading shares inhabited by issuers of blue chips.