5 Reasons Stock Investing Still Relevant Despite Rupiah & IDX Turmoil

The rupiah exchange rate and the performance of the IDX Composite are key indicators of economic health as well as investor confidence in the domestic market. These two factors also frequently serve as benchmarks in making investment decisions.

This week, the rupiah and IDX Composite have been experiencing turbulence, sparking concerns over potential layoffs, rising inflation, and the possible exit of foreign investors. The rupiah briefly touched 17,000 per US dollar, while the IDX Composite dropped to 5,882.6.

However, it's important to remember that stock price declines are part of a market cycle and can actually present opportunities to buy quality stocks at lower valuations.

Why is Stock Investment Remains Relevant?

1. Chance to Buy at a Discount

When the market dips, blue-chip stocks with strong fundamentals become more affordable. There's strong potential for gains once the market recovers.

2. Long-Term Investment

The stock market tends to recover over time. Long-term investors can stay focused on the fundamental growth of the companies they invest in.

3. Portfolio Diversification

Stocks are a key instrument in any diversification strategy. Investors can choose relatively “safer” sectors like consumer goods, banking, energy, or other commodities.

4. Supportive Regulatory Policies

The Indonesia Stock Exchange (IDX) has implemented measures to manage market volatility, including adjusting the lower Auto Rejection (ARB) limit and enforcing trading halts when necessary.

5. Hedge Against Inflation

In certain conditions, fundamentally strong stocks—especially those that regularly pay dividends—can offer returns that outpace inflation.

With a disciplined approach and thoughtful analysis, stocks remain a relevant and strategic choice for investors. Every situation presents an opportunity to strengthen your portfolio.

Disclaimer: The content is made for educational purposes, not a recommendation to buy or sell a particular stock. PT KAF Sekuritas Indonesia is licensed and supervised by the Financial Services Authority (OJK).