Investing serves as one of the key tools to achieve long-term financial goals and generate returns. However, it’s important to keep in mind that each investment vehicle carries its own risks and characteristics that must be carefully evaluated before building your investment portfolio.

In essence, the performance of various investment instruments can be significantly influenced by both global and domestic economic conditions, which are subject to change at any time.

“If you’ve already started investing, then global conditions will greatly impact your profits, or even influence your decision to enter the investment world.

When the economy is strong, stocks will typically rise, the rupiah strengthens, and Indonesia’s economy performs well—so wherever you put your money, your investments will likely succeed,” said Purbaya Yudhi Sadewa, Chairman of the Indonesia Deposit Insurance Corporation (LPS), during the "Cuan Class Goes To Campus" event with the theme “Profit Hunting for Gen-Z” at Airlangga University, as quoted on Tuesday, May 27, 2025.

He further explained that it’s a different scenario when the economy is facing a downturn. For instance, if central banks are leaning toward raising interest rates, Bank Indonesia will likely follow suit. This situation can lead to a slowdown in economic growth.

Therefore, during periods of economic uncertainty, investors should consider shifting to safer investment options. This is because global fluctuations have a direct impact on the domestic economy and influence which investment strategies are likely to be profitable.

“If there’s a severe economic shock and you can anticipate it early, that’s a good thing. You can exit risky assets like stocks early and move your funds into something safer, such as bank deposits, which are simpler and insured by LPS,” he explained.

He recommended that investors temporarily exit equity markets and shift toward safer instruments like time deposits. For your information, bank deposits are insured by LPS up to IDR 2 billion per customer, per bank.

When the economic outlook becomes more stable and the global situation improves, investors can then consider returning to higher-risk instruments. These options tend to offer better growth prospects and higher potential returns.