In investment, one of the instruments is known, namely SUN (state debt securities). Government bonds are in the interest of many people because they have the right factors for beginners. If you want to know about SUN or government bonds, then see the following article:
What is SUN
(SUN) Government bonds are securities issued by the government. Government bonds are generally used by the government to finance the government's budgetary needs, such as closing the deficit in the state revenue and expenditure budget or the state budget.
The existence of these state debt securities is regulated by law No. 24 of 2002 which consists of the state treasury certificate or SPN and state bonds or ORI. Government bonds can be owned by investors through the primary market or secondary market.
The primary market is the activity of offering and selling government bonds for the first time, while the secondary market is the trading activity of government bonds that have been sold on the primary market.
Type of SUN (State Debt Instruments)
In accordance with law number 24 of 2002, there are several types of government bonds, including:
State Treasury Letter or SPN
Treasury bills are government bonds with a maximum term of 12 months with interest payments at a discount.
Government Bonds
Government bonds are government bonds with maturities of more than 12 months with coupons or interest payments at a discount.
Indonesian Retail Bonds Or ORI
Government bonds traded in retail are Indonesian retail bonds. The purpose of the issuance of ori is to provide the widest opportunity for the public or live broadcast investors to own and actively trade in the trading of state bonds.
Retail Saving Bond or SBR
SBR is a derivative of ori which has properties similar to savings or bank deposits for the retail community. Generally, the tenor of retail saving bonds is not too long like sbr003 which has a tenor of 2 years.
Who Can Buy Government Securities?
Government bonds can be owned by investors individually or institutionally as long as they are Indonesian citizens, which can be proven by attaching an ID card at the time of purchase.
Government bonds can also be obtained through the Primary Market or the secondary market.
What is the Physical Form of Government Bonds?
Government bonds can be issued in physical form or not, namely in the form of script or without script or scripless. Government bonds in circulation can be issued in a form that can be traded or not traded.
Government bonds are in the form of scripless so investors don't have to worry when buying them and investing in things that are not visible because there is proof of purchase such as invoices.
This evidence can later be used for disbursement of investors' principal funds when they are due.
Purpose of Issuance of Government Bonds
Government bonds are issued for several purposes, including:
- Financing the state budget deficit
- Cover short-term cash shortage
- Manage the sovereign debt portfolio
The government will later be authorized to issue state debt securities after obtaining approval from the DPR which has been ratified within the framework of the ratification of the APBN and has consulted with Bank Indonesia.
Who Manages Government Securities
The party that manages state debt securities is the Directorate General of debt management or DJPU. DJPU has duties related to the management of government securities such as preparing the formulation and implementation of management policies which include several things, including:
- Optimal portfolio structure planning
- Execution of publishing
- Sales and repurchase and exchange
- Management of sovereign debt portfolio risk
- Development of government securities market infrastructure and institutions
Publication of information on the management of government bonds through technical policies that have been determined by the Director General.
Benefits of Government Securities for Investors
Government bonds are one way of investing that has a risk free of default. Government bonds can provide opportunities for investors to diversify their portfolios to minimize investment risk.
As for the level of profit from this investment as in bonds, which come from coupon or interest income and the potential for price increases or capital gains from bond prices.
Government bonds are investment instruments that are free of default risk because interest and principal payments are guaranteed by the government bonds law.
Therefore, every year the government budgets for the payment of coupons or principal of state debt securities in the APBN.
Products from government bonds such as bonds can be used as collateral and can be sold at any time if investors need funds.
How to Buy Government Securities
If people want to buy government bonds online, they can go through the website www.kemenkeu.go.id. There are several steps you can take to buy government bonds as follows:
Registration
The government will facilitate potential investors to be able to buy government bonds online through the debt securities provider page. At the registration stage, you need to prepare personal identity such as ID card, bank account number, single investor identification number or SID and securities account number.
Single investor identification or SID in the form of a single code issued by the Indonesian Central Securities Depository or KSEI. The role is as a depository and settlement institution.
Booking
After you register, you will make a purchase. However, before buying a series of government bonds, you need to make sure by reading the terms and information listed, such as when you bought ori 021 and ordered the series during the offer period.
Payment
The third step is to verify the order. if the payment is successful then you can get a payment code via SMS or email. These codes are listed according to policies and individual distributions. Furthermore, payments can be made via ATM internet banking, postal tellers or Mobile Banking.
Confirmation
Then the next is to confirm the payment. You will get a State Revenue Transaction Number or NTPN which will later be informed about the notification of the order being completed according to the 1st of settlement or issuance.
Stock Exchange: Definition, How it Works and Types
Investing is an activity that is carried out between communities. One of the places that can be a place for investors to invest is the stock exchange. To find out more about the stock exchange, this article will go deeper. Let's see!
Understanding Stock Exchange
The stock exchange is a market that deals with the buying and selling of securities in a company listed on the stock exchange. According to Law No. 8 of 1995 concerning the capital market is an item that is traded at the place of sale and purchase, the securities in question are securities such as stocks and bonds. Stock exchange is also defined as a large collection of markets and exchanges that involve the buying, selling and printing of company shares publicly.
How the Stock Exchange Works
For all buying and selling processes, facilitated by the stock exchange so that companies can be found or landed on the market, to achieve this goal, companies must of course follow the terms and conditions issued by the stock exchange. In principle, companies that have the potential to become large companies with large capital will be easier to register. This capital is obtained from investors who invest in IPO companies listed on the stock exchange. This additional capital by selling half of the company's shares to the public.
The Duties and Roles of the Stock Exchange
Stock exchanges certainly have duties and roles that you can know as follows:
- As a Facilitator in securities trading with detailed duties of providing facilities for buying and selling securities, making regulations related to stock exchange activities, making efforts for the liquidation process, making notes on securities instruments, conducting transparency on all exchange information.
- As a Securities Transaction Supervisor, which has a full role in monitoring all securities transactions. Plays a role in preventing fraud or price fraud, the right to revoke securities when finding violations of certain rules.
Stock Exchange Type
The types of stock exchanges that you can know are:
Regular Market
Namely a market with trade based on a bargaining process through a continuous auction through JATS. The settlement is carried out 2 working days after the exchange transaction. The condition is that the shares owned are equivalent to 100 shares and the purchase or sale price entered is in accordance with the price fraction determined by the stock exchange.
Negotiated Market
Bidding is done directly (individually) not through auction. The process in question is a process between stock exchange members, customers, and stock exchange members with the Indonesian Clearing and Guarantee Corporation (KPEI). After that, it will be processed through JATS or the Jakarta Automated Trading System.
Cash Market
This market is also known as the regular cash market. The process is the same as in the regular market through continuous auction negotiations, the difference is that settlement is carried out on the same trading day as the transaction on the stock exchange.
Examples of Capital Market Instruments
The capital market in the stock exchange sells various types such as the following:
- Share
- Bond
- Mutual Fund
- EFT
- Derivatives
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