GROWTH ON COMPOSITE STOCK PRICE INDEX IN INDONESIA STOCK EXCHANGE

Abstract

This study aims to determine the effect of macroeconomic factors, namely exchange rates,
money supply and economic growth on the performance of composite stocks that occur in
Indonesia on the Indonesia Stock Exchange (IDX) both in short term relationships and long term
relationships. The data used in the study are secondary annualy data from 1997 to 2019 (23
years). The results obtained in this study are a short-term equilibrium relationship using the error
correction method (ECM) test, the results obtained that the independent variable exchange rate,
money supply and economic growth have a short term equilibrium relationship to composite
stock in the short term. Likewise the estimation results that have been made on the research
model show a partial or joint relationship (simultaneous) between all independent variables,
namely the exchange rate, money supply and economic growth on the dependent variable,
namely the composite stock shows a significant and influential relationship in the long term
relationship. The results of this research are expected to be used as additional information and
knowledge for potential investors to make investment decisions. For issuers, it can be taken into
consideration in determining company policies.