Abstract
This study determines which pension fund investments affect the return of investment in the pension fund industry. This research is an explanatory research conducted using multiple regression with data from the monthly pension fund statistics for the March 2015 to June 2018 period. The results show that of the 19 investments that the pension fund industry can make, there are still 2 types of investments that have not yet been made and 3 types of investments exceeding the limit specified allocation. In this study, only government bonds and land investments have a positive effect on return of investment while land and building investments have a negative effect. The results of this study indicate that the regulations do not have an impact on changing the type and allocation of investment in the pension fund industry, and is still dominated by certain investments that do not have an influence on the profitability of the pension fund industry which is measured by return of investment. Therefore, further studies are needed. This study is useful for (1) the pension fund industry to be able to apply investment portfolio theory regarding the types and allocations of investments and start new types of investment that are permitted (2) for financial services authorities (financial services authority) in order to arrange regulations regarding the type and allocation of investment.
Highlights
Government bond has a positive effect on return on investment, meaning that if investment in return on investment increases, return on investment increases
Direct placement in share and land-building has a negative effect on return on investment, meaning that if investment in direct placement in share and landbuilding increases, the return on investment will decrease, the profitability seen in investment on investment decreases
Based on the results of the study, it can be seen that the types of investment that affect return on investment are government bond with a positive influence and direct placement in share and landbuilding with a negative influence on return on investment
Summary
The purpose of the regulations is to increase the type of investments made by the pension fund industry in Indonesia, so that the pension fund industry has many options for investing. Based on the regulations above, the pension fund industry can adjust its investments in accordance with the rules that have been published and can change the type and allocation of investment. This takes time because it cannot be changed immediately because it is bound to a contract, one of which is related to the investment period. Implementation of financial services authority regulation no. 3 / POJK.05 / 2015 in the pension fund industry are as follows [3, 8]
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