FCA Mechanism Help Improve Capital Market Awareness Investors

Illustration. (Photo: Doc. Antara)

JAKARTA - The Indonesia Stock Exchange (IDX) officially implemented the Full Periodic Call Auction (FCA) mechanism on the Special Monitoring Board on Monday, March 25, 2024. Previously, the Special Monitoring Board was implemented in a hybrid manner, where the shares placed on the Special Monitoring Board (PPK) could be traded by call-auction and continuous auction according to the specified criteria. The PPK itself was created specifically for stocks that have PR that must be completed and tend to the PR is relatively negative so that the shares are considered more risky.

Since its inauguration until now, the FCA mechanism has received mixed responses and highlights from various market participants. Some argue that the FCA mechanism has the potential to harm investors because it increases the risk of stock transactions, some agree with the Exchange that FCA can protect Indonesian capital market investors.

In response to this, capital market practitioner Hans Kwee said the FCA could make investors more aware of the stocks on the Special Monitoring Board and pay attention to the investment risks it faces.

"The main benefits are awareness, yes. So, providing awareness to investors, there are stocks that are in special monitoring, so the transactions, the methods are different. So, if investors don't know for sure the company's fundamental conditions, it's best not to transact against these shares," Hans told reporters, Wednesday, June 12.

In addition, Hans continued, the FCA method in the Special Monitoring Board can also increase awareness for related issuers. He revealed, there are stock issuers whose performance is good but less aware of their shares on the Exchange and only focus on their main business.

Thus, when liquidity is low or the stock price drops so that it enters the Special Monitoring Board, as well as is transacted by FCA, it is hoped that the issuer can try to improve so that its shares can be traded better on the Exchange.

"Yes, the Special Monitoring Board raises awareness of both investors' awareness and awareness of their issuers. As long as his business is still running, he should try to get out of there. Well, how to? He fixes the problems he faces, so he can get out of there," he said.

Furthermore, Hans highlighted the psychology of Indonesian capital market investors who tend to be concerned with increasing prices in choosing stocks, regardless of the risk of lowering their share prices. The risk of shares becomes large if there is a price difference with the fundamental value.

"Teman-teman pelaku pasar lebih penting saham yang harganya naik, sehingga ada untuknya, jadi yang lagi ngetren dikejar dan dibeli. Nah, tapi di sisi lain kadang-kadang saham-saham ini berisiko tinggi. Ini yang sering menyebabkan banyak investor menderita kerugian," tambahnya.

Hans reminded that not all shares in the Special Monitoring Board are bad. There are also several stocks that have great prospects and potential that are most likely only visible to investors who understand the company's business and calculate the company's valuation so that the hope is that the one who transacts there is a more experienced investor.

For this reason, Hans provides tips for investors who want to transact on FCA shares on the Special Monitoring Board.

"Research before buying and don't be influenced by buying something that comes with friends and it's best not to transact if you don't understand what the shares are like, especially in the stocks that are members of the Special Monitoring Board with full call authorization," he concluded.

The FCA method can be an initial filter so that new investors are not exposed to Fear Of Missing Out or FOMO buy shares without knowing its fundamentals.