The Indonesia Stock Exchange (IDX) implemented the Special Monitoring Board starting Monday (12/6). The Special Monitoring Board is a listing board that is a follow-up development of the List of Equity-Type Securities Under Special Monitoring which has been implemented since 19 July 2021 with reference to Regulation No. II-S concerning Trading of Equity-Type Securities Under Special Monitoring. The purpose of this implementation is to improve investor protection, as well as to achieve orderly, fair, and efficient trading.
Based on IDX Press Release No: 046/BEI.SPR/06-2023 The Implementation of the Special Monitoring Board is divided into 2 (two) stages. Phase I is the Special Monitoring Board – Hybrid, which was implemented on 12/6, where shares placed on the Special Monitoring Board can be traded in a call auction and continuous auction in accordance with the specified criteria. While Phase II is a Special Monitoring Board – Full Call Auction where all shares placed on the Special Monitoring Board will be traded periodically in a call auction. The Special Monitoring Board – Full Call Auction is planned to be implemented in December 2023. The purpose of this phased implementation is to introduce all investors and Indonesian capital market stakeholders to the periodic call auction trading mechanism on the Special Monitoring Board.
The Director of Trade and Regulation of IDX Exchange Members Irvan Susandy said that the trading mechanism on the Special Monitoring Board would also be differentiated according to the stages. In the implementation of phase I (Special Monitoring Board – Hybrid), the trading mechanism will be divided into 2 (two), namely a call auction and a continuous auction. “For the Phase I Special Monitoring Board, stocks subject to liquidity criteria will be traded in a call auction, while stocks subject to other criteria will be traded in a continuous auction. The call auction mechanism is a more appropriate trading method for stocks with fewer transactions so that it can improve the price discovery mechanism. This system can also reduce the volatility of stock trading.” said Ivan.
In this Phase I, there are 2 periodic call auction sessions in Exchange trading day, with trading parameters in the call auction trading mechanism having a minimum price limit of IDR 1 (one rupiah) and auto rejection of IDR 1 (one rupiah) for a stock price range of IDR 1 – IDR 10 and 10 % for share price range above IDR 10. In Phase II (Special Monitoring Board – Full Call Auction), all shares included in the Special Monitoring Board will be traded by call auction with a minimum price limit of IDR 1 (one rupiah) and auto rejection of IDR 1 (one rupiah) for a share price range of IDR 1 – IDR 10 and 10% for share price range above IDR 10. In the full call auction stage, periodic call auction trading will be carried out for 5 sessions in a day of Exchange trading.
IDX Development Director Jeffrey Hendrik also said that through the implementation of the Special Monitoring Board with a call auction mechanism, IDX is also implementing best practices and common standards used by other global exchanges for trading stocks with low liquidity. “With a fair price formation mechanism, the Special Monitoring Board is aimed at increasing investor protection by increasing transparency so that investors can make rational investment decisions,” added Jeffrey. IDX hopes that with the implementation of this Special Monitoring Board, IDX will increasingly be able to realize an orderly, fair and efficient Indonesian capital market.
The list of shares to be placed on the Special Monitoring Board shall be submitted by the Exchange. The announcement of the list of shares of the Special Monitoring Board can be seen on the official website of the Indonesia Stock Exchange.
That’s all the details of the implementation of a special monitoring board for investor protection. Hopefully, this information can be useful!