The Existence of Flight to Quality: Evidence From Indonesia

DOI

10.2991/iconies-18.2019.71How to use a DOI?

Keywords

Stock, bond, investment

Abstract

This paper aimed to analyze the investments shift from high-risk investment (stock) to a more secure investment (bond) or commonly called a flight to quality in the event of a crisis in Indonesia. The samples in this study are Jakarta Composite Index (JCI), Indonesia Corporate Bond Index (CBIX) and Indonesia Government Bond Index (GBIX) in Indonesia during the study period from January 2007 to December 2014. This study uses the event study. The data sources for bond prices are from Indonesia Bond Pricing Agency (IBPA) and Indonesian Capital Market Electronic Library (ICAMEL) while the stock data is from Yahoo Finance. During the study period, 2007-2014 is found five events that identified the crisis. The results showed that during the study period 2007-2014 in Indonesia, when the market is experiencing a crisis, the investment movement from high-risk investment (stock) to a more secure investment (bond) does not occur or flight to quality does not occur. The cases differ from previous studies in times of crises.

Copyright

© 2019, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Muhammad Riza Hafizi
PY  - 2019/10
DA  - 2019/10
TI  - The Existence of Flight to Quality: Evidence From Indonesia
BT  - Proceedings of the 2018 International Conference on Islamic Economics and Business (ICONIES 2018)
PB  - Atlantis Press
SP  - 356
EP  - 359
SN  - 2352-5428
UR  - https://doi.org/10.2991/iconies-18.2019.71
DO  - 10.2991/iconies-18.2019.71
ID  - Hafizi2019/10
ER  -