13 May 2009

Market Capitalization Aspect in IDX: Bakrie Case

this article contains personal opinion based on simple experience of an IT engineer, so if some how this article is contradict with other mainstream then harap maklum :P

I've been investing in stock market since 2008. In this posting, I just want to share some simple things in what I've been facing. As you know, Indonesia Stock Exchange had a very nice bullish trend back in 2005 to 2007, then in late 2008, IDX along with other global stock market in the world had lost half its value.

In stock investment, the main player company with their big stock volume being traded in the stock market is called the big capitalization stock. In IDX in the last few years, the big one is TLKM and BUMI just become the biggest in 2008. The big caps stock price movement will affect the overall index, thats why big caps stock is more dynamic than any other stock in the market.

For example TLKM, in the early 2008 hit its lowest price because of the Content Provider problem and also for the tough competition in the market. But late in 2008, TLKM managed to get their position back as biggest caps in the IDX.





BUMI is another story, BUMI managed to get their highest price in 2008 with almost 500% rise in their 2005 price. But in the end of 2008, BUMI hit its initial price just like in 2005.



The market capitalization is one the important part any investor should consider in stock investment. If you want to get your investment worthed, you should consider to buy the big caps stock in its low price and hold them, it may not need long years to get your profit.

Happy investing.

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