Ranking Based Index: Getting to know Pefindo i-Grade and IDX Pefindo Prime Bank

In an effort to provide investment alternatives based on strong fundamentals, PT Pemeringkat Efek Indonesia (Pefindo) together with the Indonesian Stock Exchange have released two leading stock indexes: Pefindo i-Grade and IDX Pefindo Prime Bank. These two indices aim to be an investment reference that prioritizes aspects of the quality and fundamental health of issuers, with a main approach based on credit ratings.

Pefindo i-Grade: Investment Grade Based Stock Index

Launched on December 21 2017, Pefindo i-Grade (Investment Grade) is an index consisting of 30 company shares that have an investment grade rating from Pefindo. Companies included in this index have gone through a ranking process which is generally carried out for the purpose of issuing corporate bonds or to assess their financial health.

The ratings used range from BBB- to AAA, following standards accepted in the Indonesian capital market. Apart from ranking factors, the stock selection criteria in this index also consider total assets, level of stock liquidity, market capitalization and legal aspects.

IDX Pefindo Prime Bank: Focus on the Banking Sector

The second index, IDX Pefindo Prime Bank, was launched in October 2023 and focuses on the banking sector. This index includes 10 bank shares that have an investment grade rating from Pefindo. As the main market driving sector, the selection of banks in this index is also based on additional criteria such as valuation, to assess whether the shares are undervalued or overvalued.

Positive Performance and Relevance of the Index

Both Pefindo i-Grade and IDX Pefindo Prime Bank showed solid performance. Until the end of January 2025, the Prime Bank index recorded a return of 2.4% in just one month, while i-Grade recorded a return of 1.8%, amidst a general market weakening trend.

Historically, Pefindo i-Grade has shown impressive performance with a return of 109.43% since the December 2012 database, far exceeding the IHSG (64%) and other indices such as LQ45 (12%) or IDX30 (14%). Meanwhile, IDX Pefindo Prime Bank, which has a database since January 2017, recorded a return of 116%, higher than the IDX financial sector index (79%) and the Infobank15 index (89.8%).

Become a Fundamental-Based Investment Reference

Through an approach that emphasizes fundamental quality and rating credibility, these two indices become an alternative for investors who want to invest in a more measurable and strategic manner. Both institutional and retail investors can use this index as a reference for forming a fundamentally healthy stock portfolio.

With proven performance and a strict selection methodology, Pefindo i-Grade and IDX Pefindo Prime Bank are expected to continue to make a positive contribution to the investment ecosystem in the Indonesian capital market.

Complete Video Podcast: IDX PEFINDO PRIME BANK & I-GRADE