Date: 25-01-2020 Digital Publication Services : JABM | JAM | ABMR | ABMCS | BLOG

Faculty Research


ID 202.710.295
Published Date 23-05-2014


-Abstract The capital market is one of the important financial sector in the economy of a country. The capital market is on of the effective means to fasilitate long-term funds held by the public to be channeled in productive sectors. Capital market as on of the economic instruments is influenced by events that contain information for investors. Increasingly important role of capital markets in the economy of a country. The more sensitive the capital to various event around him. This study aims to assess the capital market reaction to the announcement of United Indonesia Cabinet reshuffle vol 2 which took place on October 19, 2011. This research is quantitative descriptive. Assessment Cabinet Reshuffle reaction to the announcement of the stock price movement LQ45 done through observation of price movement, abnormal returns (abnormal returns), Capital Asset pricing Modal (CAPM), and to Varibility Reward Ratio (RV) during the observation period of 14 days before and 14 days after the announcement date. The results showed that the announcement of the cabinet reshuffle, do not give too strong an influence on the movement of stock prices, this is evidenced in the average stock price and the average abnormal return is ecperiencing fluctuating movement in the period of United Indonesia Cabinet reshuffle Volume 2. There is no visible trend o the market overreacted to the emergence of a significantly. Based on this, there is no significant relationship between abnormal returns before and after the cabinet reshuffle which was conducted on October 19, 2011. Pessimistic attitude toward improved market performance of the post-reshuffle cabinet ministers are also an indication that the market is not overly action resulted in the announcement of the government's cabinet reshuffle. This study aldo showed that agriculture, mining, and chemical industry base, a variety of industries, finance and trade in services and investment sector was the most good for investment because of the calculation CAPM ecpected return E (Ri) produced smaller than the average expected return is realized (Av.Ri) per sector and the low share price means the right time to invest. For Industrial and Chemical sector is a sector that is at the top rank has a value of -0.15987 and is the most effected sectors. While a good stock for investment is INTP, SMGR, KRAS, and CPIN. Top ranked stocks are INTP taht has the highest value that is equal to -0.09966 and is the most affected stocks. Keywords: reaction, capital markets, cabinet reshuffle