JAKARTA (TheInsiderStories)—The Indonesia Stock Exchange (IDX) launched three new stock indexes on Thursday (17/05) as an alternative reference for investors and traders in the market.
It includes IDX High Dividend 20 that groups 20 publicly-listed companies, which regularly distributed dividends to its shareholders for the last 3 years and have a daily average of regular transactions of more than Rp1 billion in the last 3 months, 6 months, and 12 months. IDX High Dividend 20 Index is selected based on dividend yield, liquidity criterion, and market capitalization.
Another two new stock indexes are IDX BUMN20 and Jakarta Islamic Index 70 (JII70). IDX BUMN20 is a price index of 20 state-owned companies, region-owned companies, and affiliates; while JII70 is an index of 70 sharia companies that have high transaction liquidity.
The IDX BUMN20 index is selected from the shares of state-owned companies, region-owned companies, and affiliates (a subsidiary or share ownership by the government) which has been recorded for 6 months. IDXBUMN20 Index is selected based on liquidity criteria, the number of days traded, and market capitalization.
Meanwhile, JII70 Index is selected from sharia shares which are included in the constituents of Indonesia Sharia Shares Index (ISSI) and have been recorded for the last 6 months. Furthermore, JII70 Index is selected using market capitalization and average daily transaction value in the regular market.
IDX hopes these new stock indexes become an alternative reference for investors and fund managers. In the future, these indices can be used as a basis for the reference to capital market products such as mutual funds, Exchange Traded Fund (ETF), and other derivative products.
The method of calculating the IDX High Dividend Index 20 uses the Capped Dividend Yield Adjusted Free-Float Market Capitalization Weighted method. This index uses the market capitalization value and the number of shares in the public (free float) as the weight with the adjustment using the yield, and impose the weight limit in the highest index for one share is 15 percent.
Meanwhile, the method of calculating IDX BUMN 20 Index using the Capped Market Capitalization Weighted method or using market capitalization as weight and imposing the weight limit in the highest index for one share is 15 percent. While the method of calculating the JII70 index is equal to the majority of stock indices in BEI, namely Market Capitalization Weighted.
IDX will conduct two periodic evaluations of IDX High Dividend 20 and IDX BUMN20 Indexes, which are Major Evaluations that include evaluation of constituents and re-adjustment of stock weight in the index. Hereinafter is Minor Evaluation which only includes re-adjustment of stock weight in the index.
For IDX High Dividend 20 index, Major Evaluation will be done at the end of January and will be effective every first bourse day in February. Minor Evaluations for the index are conducted at the end of July and will be effective every August first.
Meanwhile, Major Evaluation of IDX BUMN20 index conducted at the end of January and July for next will be effective every first trading day in February and August. Minor Evaluation for IDX BUMN20 index conducted at the end of April and October will be effective every first bourse day in May and November.
The JII70 Index will be subject to periodic review at the end of May and November and will be effective every first exchange day in June and December. This period follows the regular ISSI review schedule and the Jakarta Islamic Index (JII).
IDX sets the base date for IDX High Dividend 20 and IDX BUMN20 indexes on 30 January 2009 with a base value of 100. As for the JII70 index set the base date on May 29, 2009, with a base value of 100.