Mysterious 1,000% Stock Gains Baffle Traders in Indonesia
- Wild stock swings are confounding market participants
- Regulators launch new watchlist to monitor ‘troubled’ firms
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Unexplained gains in Indonesian stocks are fueling calls for tighter regulation in Southeast Asia’s biggest equity market.
Known as “deep fried” shares among local traders, they often have concentrated ownership, low trading volume, scant analyst coverage and elevated valuations relative to peers. In the past three years, at least 83 Indonesian companies have swung by 1,000% or more from peak to trough, according to data compiled by Bloomberg. That’s about 10 percent of total stocks listed, a higher proportion than in neighboring Thailand, Malaysia, Singapore, Vietnam and the Philippines.