Jamsostek to invest more in stock
Jamsostek to invest more in stock
Rendi A. Witular, The Jakarta Post, Jakarta
Hoping to take advantage of the booming stock market amid rising
confidence among foreign investors, state-owned social security
firm PT Jamsostek is planning to increase its investments in the
local bourse.
Jamsostek's newly appointed president director, Iwan
Pontjowinoto, told The Jakarta Post recently that the company
would increase its investment in stocks to at least 15 percent of
its total investment portfolio this year as it believed the
bourse would rise even further.
"The fundamentals of our bourse are strong. Yields from
investments in stocks are higher than any other investment
portfolio. However, we realize that the risks are also greater.
Therefore, we are not going to invest speculatively," said Iwan.
The company's total investments this year were expected to
increase to Rp 40 trillion, he added.
In 2004, Jamsostek invested Rp 14.1 trillion in bonds, Rp
14.37 trillion in bank deposits and Rp 3.44 trillion in stocks,
mutual funds and other securities.
With such a huge amount of funds under its management,
Jamsostek is the only local institutional investor that is
capable of acting as a key mover of the stock market, with most
other movers being foreign based investment banks and securities
houses.
In fact, due in part to the massive amount of funds at its
disposal, Jamsostek has often suspected of helping jack up the
price of shares in state firms before they were sold through
initial public offerings or secondary offerings.
Suspicions are also rife that Jamsostek has been acting as a
buffer for the government by engaging in aggressive buying to
keep the stock market index from falling whenever serious
negative sentiment sets in.
Responding to the accusations, Iwan said that he was not aware
of such practices, and gave assurances that he would not
encourage any form of investment that was not in line with making
profits on behalf of those insured by the company.
"Our investments will not be used for practices that could
cause losses to our investable funds. Our funds will only be
invested in safe portfolios over the long term," he stressed.
Iwan said that he would soon revise the makeup of the
company's investment strategy in order to gain maximum profits,
with most of the funds likely to be invested in bonds issued by
the government and private sector.
"I cannot elaborate as yet on the new composition of our
portfolio, but the greater part will certainly be in the form of
bonds," said Iwan, who is an expert on information technology.
The company has said it plans to buy more government bonds
this year to help plug the state budget deficit.