If we talk about investment strategies, first, (determine) the goal…Then we adjust, which investment instrument is suitable.
Jakarta (ANTARA) - Director of State Debt at the Directorate General of Financing and Risk Management (DJPPPR) Deni Ridwan has advised Indonesians to choose investment instruments that match their financial goals to minimize losses.

"If we talk about investment strategies, first, (determine) the goal. Whether short, medium, or long-term. Then we adjust, which investment instrument is suitable, " Ridwan expounded in Jakarta on Thursday night.

While speaking about investment strategies, Ridwan quoted the words of football coach Alex Ferguson: "attack wins you games, defense wins you titles." The phrase emphasizes the importance of building a good defense to become a champion.

Ridwan said that measures to strengthen defense need to be taken while investing to prevent losses. He then advised people to choose conventional investment instruments first because they are relatively safer.

"Importantly, this investment will yield higher returns than inflation. What is safe? Maybe deposits, retail state securities (SBN), or gold. It's an investment that probably won't lose," he explained.

Once their defense is strong, people can consider investment instruments with medium or higher risk than conventional instruments. Examples of such investments include fixed-income mutual funds, stock mutual funds, and corporate bonds, he said.

In the next stage, investors can enter investment instruments that are more "attacking," or with higher risks, such as stocks and crypto, Ridwan said.

He observed that the share of investment that is defensive or conventional tends to dominate as a person gets older. Meanwhile, the share of conventional investments in the portfolios of young people tends to be smaller because this age group is more willing to take risks.

Even so, the investment share must still be determined based on the risk preferences of each individual. Thus, it is okay for young people with a lower risk preference to invest more in relatively safer instruments.

"Again, the decision (as) to what percentage (share) is conservative and what percentage is riskier is usually adjusted to age and also to risk preferences," he added.

According to Ridwan, the younger generation must cultivate the habit of investing no matter how nominal the sum.

With just Rp1 million (around US$63.9 thousand) novice investors can purchase retail Government Bond Series 025 (ORI025) issued recently by the government with a fixed coupon rate starting from 6.25 percent per year."Some say investment is only for rich people. That is wrong. That is wrong. Moreover, with the presence of technology today, it is actually an option for us to invest more, " Ridwan asserted.

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Translator: Rizka K, Yuni Arisandy
Editor: Rahmad Nasution
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