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Risk of Investing in Shares People Need to Understand

By Eskanisa R

09 August 2020

To make some profit, ensure you know how investing in shares work.

Photo source: Pixabay
People was shocked by the case of one independent financial consulting firm which mistreated their clients. According to CNBC, Investment Alert Task Force (SWI) suspects that firm has misused activities where they were not only worked as financial advisors but also managing clients’ funds.
In spite of that case, every kind of investment has its own risks including shares which known for popular investment product. Investing in shares can be done in some different ways including buying shares of public companies when making an offering on Primary Market (Initial Public Offering or IPO) or buying on Secondary Market through Indonesia Stock Exchange (IDX), as reported from Okezone.
Hence, large profits of investing in shares making people are tempted to give a shot. Along with large profits, they also has risks including capital loss and suspension. Capital loss itself is the opposite of capital gain where buying price higher than selling price. As depicted by Modal Rakyat, if you buy shares for Rp5.000 then you need to sell them at Rp2.000, you definitely loss more than 50%.
Besides capital loss, there is also suspension which also known termination of stock trading by the Indonesia Stock Exchange (IDX) caused by many factors. While suspension happens, investors cannot sell their shares until period of suspension is expired. Suspension last for short period of time, but takes longer time for some reasons including dropping share prices drastically in very short time caused IDX stop trading, bankrupt, the recent condition of macroeconomics, political stability as well as global factors like current pandemic. 

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