Starting June 5, Maximum Share Limits Drop To 15 Percent

JAKARTA - PT Bursa Efek Indonesia (IDX) will adjust the lower Auto Rejection (ARB) limit phase 1 from 7 percent to 15 percent for each share price range. This rule will start on June 5, 2023.

Director of Trade and Regulation of IDX Exchange Members, Irvan Susandy, said that the adjustment of ARB limits in the stock exchange trading system is a further stage of the trading normalization process after the COVID-19 pandemic.

Meanwhile, the Upper Auto Rejection (ARA) has not changed and remains in effect according to current policy, namely 35 percent for shares with a price range of IDR 50 to IDR 200, 25 percent for shares with a price range of more than IDR 200 to IDR 5,000, and 20 percent for shares with a price above IDR 5,000.

"The adjustment of the ARB limit aims to create a balance between the upper and lower limits in stock price movements, so that it is hoped that it can help create regular, reasonable and efficient trade," said Irvan quoting Antara, Tuesday, May 30.

Furthermore, Irvan said that the second phase of the ARB adjustment is scheduled to take effect on September 4, 2023.

In this adjustment, his party will stipulate a symmetric Auto Rejection (AR) provision, which means that the ARB limit will be the same as the ARA limit in each share price range, which is 35 percent for shares with a price range of IDR 50 to IDR 200, 25 percent for shares with a price range of more than IDR 200 to IDR 5,000, and 20 percent for shares with a price above IDR 5,000.

"With the implementation of the trade normalization policy on the stock exchange, IDX hopes that the Indonesian Capital Market can continue to grow and give more confidence to investors to continue investing," said Irvan.

He hopes that the normalization of trading hours and adjustment of ARB restrictions can provide a positive signal to investors, that economic conditions and investment climates in Indonesia are getting better, thus providing more opportunities for investors to be able to transact and increase stock liquidity on the IDX.

Investors and market players are expected to pay attention to this change and follow applicable regulations according to the effective date set. Knowing and understanding ARB and ARA boundaries is important in helping the right investment decision-making process in stock trading," said Irvan.