JAKARTA (TheInsiderStories) - The Indonesia Stock Exchange (IDX) announced the new tick size of stock price and the minimum increment in which stock prices can change in move to reduce volatility, increase liquidity and in turn attract more investors to the capital market.
IDX limits price movement to up to ten times of the stock’s respective tick size in a trading day, down from 20 times in the previous rule. The bourse divides tick size into five groups, compared to the previous three groups.
Stocks priced at Rp 200 or less will see minimum rise and fall in the price of Rp 1 per movement. Stocks at a price range of Rp 200 to Rp 500 can move at a rate of Rp 2.
Stocks priced between Rp 500 to less than Rp 2,000 can move at a rate to Rp 5; Rp 2,000 to less than Rp 5,000 at Rp 10; and stocks priced Rp 5,000 and more at Rp 25.
Previous regulation set tick size at Rp 1 for stocks priced at less than Rp 500; Rp 5 for stocks prices between Rp 500 and Rp 5,000; Rp 25 for stocks priced Rp 5,000 or more.
IDX total market capitalization as of the end of March reached Rp 5,143 trillion compared to Singapore Stock Exchange’s $894 billion and $389 billion at the Stock Exchange of Thailand.