IDX Adjusts Auto Rejection Bottom (ARB) and Trading Halt Policies to Stabilize Market Volatility

On April 8, 2025, the Indonesia Stock Exchange (IDX) officially revised its Auto Rejection Bottom (ARB) and trading halt mechanisms to better respond to today’s market dynamics. This strategic move is aimed at fostering a more balanced, efficient, and investor-friendly market environment amid global uncertainty and domestic volatility.

Why the Change?

Iman Rachman, President Director of IDX, stated that the adjustments were made in response to significant shifts in trading behavior and increasing market fluctuations. The previous trading halt trigger, set at a 5% drop in the Jakarta Composite Index (JCI), was initially introduced during the COVID-19 crisis in 2020. However, it has since proven too sensitive for the current post-pandemic market landscape.

“We want to provide investors with more room to breathe, more room for liquidity, and more time to assess and make decisions,” said Iman, as quoted by multiple sources including IDX Channel and Bisnis.com.

Key Updates at a Glance

1. Auto Rejection Bottom (ARB) Adjustments:

• Effective immediately, IDX has standardized the ARB limit at 15% across all stock boards: Main Board, Development Board, Acceleration Board (formerly New Economy Board), as well as ETFs and REITs.
• The aim is to create more room for price discovery while still maintaining safeguards against excessive declines.

2. New Trading Halt Thresholds: IDX will implement the following trading halt mechanisms based on the daily movement of the JCI:

• 8% drop → 30-minute trading halt
• 15% drop → Additional 30-minute halt
• 20% drop → Potential full-day trading suspension, subject to OJK (Financial Services Authority) approval

These new thresholds are designed to give investors and the market time to digest information and avoid panic-driven decisions.

A Market-Friendly Move?

According to market analysts, the new ARB policy may enhance liquidity during sell-offs by giving buyers more flexibility to step in at lower price levels. On the other hand, the staggered trading halt mechanism introduces a more nuanced buffer against panic selling, avoiding the abrupt freezes that rattled markets in the past.

The Financial Services Authority (OJK) has fully supported the changes, emphasizing that policy flexibility is crucial for maintaining orderly trading during periods of market stress.

Bottom Line:
The IDX’s latest policy changes reflect its commitment to evolving with the market. By updating ARB and trading halt mechanisms, IDX is not only aiming to protect investors but also ensuring the Indonesian capital market remains competitive, resilient, and attractive to both domestic and foreign investors.