Using the MSCI Indonesia Index, BNI-AM Creates ETF Mutual Funds

Jakarta, CNBC Indonesia - PT BNI Asset Management has officially launched a new product called the BNI-AM Nusantara Exchange Traded Fund (ETF) Index Mutual Fund MSCI Indonesia Equity Index or XBNI. This mutual fund is an ETF whose participation units are traded on the Indonesia Stock Exchange (IDX) through the primary market and secondary market.

The XBNI Initial Listing was held on May 23 2018 on the IDX and was categorized as the 4th ETF listed on the IDX throughout 2018. Main Director of BNI Asset Management Reita Farianti said, the launch of this ETF aims to accommodate the needs of investors who want mutual fund products that are actively traded with an investment strategy referring to certain indexes traded on the IDX.

In addition, another goal is for investors to obtain long-term investment growth in line with Indonesia's economic growth which is reflected in the performance of the MSCI Indonesia index.

"Especially for ETFs with the MSCI reference index, which are well known globally, only BNI AM has issued them, so we hope that this ETF can be an attractive investment choice in the passive mutual fund category," added Reita.

For information, the MSCI index is an index that represents approximately 80% of Indonesian stock market capitalization and has a high free float. This criterion was set by Morgan Stanley Capital International Limited (MSCI), an international independent provider of investment analysis services.

Each unit of this mutual fund participation is offered at the same price as the initial Net Asset Value of IDR 1,000 on the first submission date determined by BNI-AM as the investment manager of the MSCI Indonesia ETF mutual fund issuer.

Later, investors who buy this mutual fund product will then invest in portfolios with a minimum investment composition of 80% -100% of the Net Asset Value placed in 29 stocks included in the MSCI Indonesia index. The remaining 20% is invested in domestic money market instruments with maturities of no more than one year or deposits in accordance with applicable laws and regulations.

Meanwhile, XBNI has a diversification of shares at once, because it consists of 29 issuers included in the MSCI Indonesia index. For purchases on the primary market, the minimum transaction is 1 creation unit which is equivalent to 100,000 units of participation. While purchases on the secondary market can be made starting from 1 lot or the equivalent of 100 units of participation.