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OJK, IDX seek to educate, increase protections for growing number of retail investors
Meanwhile, the OJK also plans to launch disgorgement funds, first floated last year, to cushion investors losses resulting from criminal acts, instead of investment failure. Disgorgement is the legally mandated repayment of gains received through ill-means imposed by the courts on wrongdoers.
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IDX logo in front of a giant screen that displays information of the movement of stock prices at Indonesia Stock Exchange (IDX), Jakarta, on Friday, March 13, 2020. IHSG is closed with 11,823 points (0.24 percent) to 4,907.571 rise after experiencing trading halt twice. (JP/Seto Wardhana)
T
he Financial Services Authority (OJK) and the Indonesia Stock Exchange (IDX) have unveiled new initiatives to help educate and improve protections for the country’s growing number of retail investors during the pandemic.
On its 43rd anniversary commemoration on Monday, the IDX launched several initiatives, such as virtual trading to educate new investors before they make the jump into the actual stock market, and e-IPO, that gives retail investors wider access to participate in the primary market of an initial public offering.
Meanwhile, the OJK also plans to launch disgorgement funds, first floated last year, to cushion investors losses resulting from criminal acts, instead of investment failure. Disgorgement is the legally mandated repayment of gains received through ill-means imposed by the courts on wrongdoers.
“The [disgorgement] fund [proposal] is currently going through a public hearing. We hope we can launch it by the end of the year or the first quarter of 2021 at the latest,” OJK stock market supervision executive head Hoesen said during a virtual presser on Monday.
Such a protection scheme for investors had been implemented by the Securities and Exchange Commission (SEC) in the United States. The OJK, however, did not go into detail on whether the fund would be managed by a special institution such as the Securities Investor Protection Fund (SIPF) or by the authority itself.
Amid the ongoing global health crisis that has forced people stay home, the number of investors in Indonesia has jumped 21.7 percent to 3.02 million investors as of July 31, from 2.48 million investors by the end of 2019, according to Indonesian Central Securities Depository (KSEI) data.
Of the total investors, 99 percent are retail investors, and around 42 percent are exclusively stock market investors.
