Digital investment portal Bareksa and fund managing company Schroder Investment Management Indonesia have suggested that investors diversify the types of investment, such as considering mixed-asset mutual funds, to minimize losses.

The suggestion is in response to last month's situation when the Indonesian Composite Index (IHSG) fell to around 6 percent due to an unstable global situation, especially the "trade war” between the United States and China.  

Bonny Irawan, the executive vice president of intermediary business for Schroders Indonesia, said mixed-asset mutual funds had flexibility in facing market uncertainty, making investors able to avoid or minimize losses in the unfortunate situation.

“Investing in stock mutual funds, you can’t easily withdraw your funds when the market is slowing down,” he said recently at a press briefing on the strategy to face market volatility in 2018. 

Mutual fund investment in Indonesia has four categories: mixed-asset mutual fund, obligation mutual fund, money market mutual fund and stock mutual fund. The last category is the riskiest one. Last month, it fell around 5 percent, the most compared to the others.

“Stocks mutual funds took much of the hit because they are the blue-chip category, involving a large amount of capital,” Putu added.

Bareksa predicted that the market would be on its feet again in the second half of 2018, as this month the stock mutual fund is gradually recovering. As of Friday, the mutual fund index had gone up by 2.8 percent from its lowest point in the last two months. (bbn)