Schroders: FCA Policy Implemented by IDX Must Be Transparent and Clear

Illustration. (Photo: Doc. Antara)

JAKARTA - Schroders Indonesia Chief Investment Officer Irwanti wants the Special Monitoring Board (PPK) Full Call Auction (FCA) mechanism policy implemented by the Indonesia Stock Exchange (IDX) to be more transparent and clear.

She gave an example, one of which is the need for transparency and clear information regarding the reasons why a stock enters or exits the PPK FCA.

"We want the exchange to be more transparent with this FCA, because it involves a lot of stock numbers. Currently, there are more than 800 stocks in the JCI, of which around 220 are in the FCA. So, as much as 25 percent of our JCI is included in the FCA," said Irwanti in the Market Outlook & Business Update Semester II 2024, in Jakarta, quoted from Antara, Tuesday, July 9.

On the positive side, she said the implementation of the FCA provides liquidity for stocks whose prices cannot fall below IDR 50 per share.

"Because before the FCA, the price of shares that had reached IDR 50 per share was not traded. So, no one wants to buy, no one wants to sell, even though there are actually those who want to sell below IDR 50 per share," said Irwanti.

On the negative side, she said the implementation of FCA eliminates liquidity in stocks that are priced far above IDR 50 per share.

"So, for example, because there is FCA, people can't sell. Even though there is a high price, people can't sell, they only sell at certain hours," said Irwanti.

On the other hand, Irwanti emphasized that the emergence of this FCA mechanism is also a response from the relevant authorities as an effort to control the Composite Stock Price Index (IHSG) which has fluctuated some time previously.

"This FCA, it's a good thing, rather than nothing at all. Ideal or not, we hope it will be refined over time. What we emphasize is that the transparency of this FCA must be improved. When to enter or exit, don't be like a mystery," said Irwanti.

Previously, Director of Trading and Member Regulation of the IDX Irvan Susandy hoped that stock trading could be more active along with the implementation of the Special Monitoring Board (PPK) Full Periodic Call Auction (FCA).

"Through this mechanism, we hope that these stocks can be traded more actively according to their fair price, the information of which can be seen through the IEP & IEV," said Irvan.