What is IHSG?

The Composite Stock Price Index is usually abbreviated as IHSG, in English he is also commonly called the Indonesia Composite Index, ICI, or IDX Composite. The definition of a Composite Stock Price Index (CSPI) or the meaning of JCI is one of several stock market indices (stock markets) used by the Indonesia Stock Exchange (BEI; formerly the Jakarta Stock Exchange (BEJ)). The IHSG was first introduced on April 1, 1983, the function of the stock price index acts as an indicator that reflects the share price movements in the JSX in general.

Although the IHSG is an average value of all shares in Indonesia, but the points displayed are not just to know the extent of the highest or lowest level, but there are many effects and benefits to the economy of this country. By knowing the movement trend, investors will know what the current market conditions are, and if the results of the valuation are implemented in the form of investments, it will have an impact on the significant turnover of funds in our economy.

The types of the Composite Stock Price Index are: All shares are a value used to measure the combined performance of all shares listed on a stock exchange.

  1. A stock group is a value used to measure the performance of a group of shares listed on a stock exchange.
  2. The LQ 45 index is an index of 45 listed companies listed on the Jakarta Stock Exchange, with a measure of liquidity and market capitalization value.
  3. JII Index (Jakarta Islamic Index), which is an index used as a benchmark (benchmark) to measure the performance of an investment in shares with a sharia basis.
  4. Business type (sectoral) is a value to measure the performance of stock groups that have been classified into 9 sectors, namely agriculture, mining, basic and chemical industries, consumer goods industry, property and real estate, transportation and infrastructure, finance, trade, services and investation.

IHSG has several functions or performance descriptions of an exchange including:

  1.  As a market trend indicator.
  2. As an indicator of the level of profit.
  3. As a benchmark the performance of a portfolio.
  4. Facilitating portfolio formation with passive strategies.
  5. The Composite Stock Price Index is the main indicator that describes the movement of stock prices in the capital market. Generally all composite price indices in various countries use the weighted average method included in the Indonesia Stock Exchange.

Sources:

https://www.sahamonline.id/2017/05/pengertian-indeks-harga-saham-gabungan.html

https://analis.co.id/ihsg-indeks-harga-saham-gabungan.html

https://economy.okezone.com/read/2017/10/27/278/1803615/mau-investasi-saham-cari-tahu-apa-itu-ihsg-dan-10-indeks-lainnya

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