Barack Obama and Stock Market

Historically, is is not unusual for the stock market to slide after the election of a Democratic president. The fact that it was the biggest slump ever after an election has to be taken in the context of an extremely volatile market in Indonesia.

On the previous day, we also saw a record surge in the market for a presidential election day.

There was a bad report on jobs and service industries, but it’s really hard to analyze what happened between these two days. Most of this volatile activity is due to day and swing traders who often trade according to patterns on charts or graphs known as “Japanese candlesticks.” There may be little actual relationship to the election itself.

Americans generally turn to the Democrats during tough economic times. The best example of this was during the Great Depression. Bill Clinton also appeared to have benefited from the recession that hit during George H.W. Bush’s term. There appears to be a general perception that Democrats will do more to help struggling workers and families, and those who are down and out.

Sejarah Bursa Efek Indonesia (BEI)

Here, we are revealing a brief history about Indonesia Stock Exchange from the beginning. First period is from 1912 until 1942, 1952 until 1977, 1977 until 1988, 1988 until 1997, 1997 until 2007 and the last periode between 2007 and now.

a. 1912 - 1942
Vereniging voor Effectenhandel build on December 14, 1912. After World War I, stock market in Surabaya, Indonesia start at January 1925 and in Semarang at August 1925. Almost company that sell their stock are from Dutch that member of Dutch East Indies Trading Agencies. The trading was close in 1942 when Japanese conquer Indonesia.

b. 1952 -1977
After Japanese left Indonesia, at September 1, 1951 Indonesian Government declare Undang-undang Darurat number 12 that become Undang-Undang Nr. 15/1952 about stock market. Finnaly, Bursa Efek Jakarta/BEJ (Jakarta Stock Exchange/JSX) launc at June 3, 1952.
JSX have purpose to facilitate government obligation that release before. Another purpose are prevent capital flight from Dutch company that traded in JSX before. The effect of conflict between Indonesia and Dutch about Irian Barat, all of Dutch company no longer trade in JSX after 1960.

c. 1977 – 1988
By Keputusan Presiden Nr. 52/1976, Badan Pembina Pasar Modal had build and become starting point new period. Presiden Soeharto acknolegde Bursa Efek Jakarta (Jakarta Stock Exchange) at August 10, 1977 and the first company that listing their share is PT Semen Cibinong at June 6, 1977. There were no much company that interest to trade their share, and until 1988 only 24 companies that listed their share.

d. 1988 – 1997
Only in three years, between 1988 – 1990 there were many company began listed their share. In the end on 1990 there were 127 companies that listed their share ant in 1996 become 238 companies. In this period, Initial Public Offering (IPO) are national event. This event caused by: request from foreign investor, regulation to increase export in Indonesia except mining and generation change from family business to profesional business.
In this periode Surabaya Stock Exchange (Surabaya Stock Exchage/SSX) build at June 16, 1989. SSX trade only obligation and after 1989 there were 340 obligation that trade in SSX. In 1995, JSX and SSX use high technology so all of transaction use automated namely Jakarta Automated Trading System (JATS)

e. 1997 – 2007
Indonesia have crisis global in 1997 and many company were collapse. Until ten years then, there are many change in JSX.

f. 2007 -
In 2007, Jakarta Stock Exchange and Surabaya Stock Exchange are merge become Indonesia Stock Exchange (IDX) or Bursa Efek Indonesia (BEI).

Stock Market Basics

A company that need capital can be sell share di stock market. Share stock that issued by company are trade in primary market. Share stock offer to public by initial public offering (IPO) or share addition if the company being go public. Then, these share that be trade can be sell in secondary market. Another type in stock markets is third market and fourth market. Third market is share market when secondary market closes. Third market operates by brokers who facilitate buyer and seller to meet when secondary market is closed. Fourth market is share market between big institutions to ignore commission for broker. Fourth market generally use communication channel to trade share stock in big volume

Rasio Keuangan

There is variation the financial ratios provided for banks, insurance companies. All ratios are computed in line with definitions commonly used for respective industry, some of which are self-explanatory such as debt to equity to total assets. Others are also in conformity with commonly used ratios which for clarity are defined below.

PER : price earnings ratios or closing share price at the end of respective financial statement period divided by earning share.

PBV : price book value or closing share price at the end of respective period divided by equity per share.

Dividend pay out : dividend per share divided by earnings per share.

Dividend yield : dividend per share divided by closing share price at the end of respective period.

ROI (Return on Investment) : profit after tax divided by total assets.

ROE (Return on Equity) : profit after tax divided by equity

Current ratio : current assets divided by current liabilities.

Leverage ratio : total debt divided by total assets.

Gross profit margin : gross profit divided by net sales.

Operating profit margin : operating profit divided by net sales.

Net profit margin : profit after tax divided by net sales.

Total assets turnover : net sales divided by end of period total assets

Inventory turnover : cost of good sold divided by end of period inventory.

Expense ratio : operating expense divided by premium received.

Loss ratio : claim paid divided by premium received.

Solvency ratio : equity divided by net premiums (premiums after deduction of premiums for reinsurance).

Cash and banks to demand deposits : cash, Bank Indonesia and other banks divided by demand deposits.

Cash and cash to total deposit : cash, Bank Indonesia and other banks divided by demand deposits.