Indonesia isn't a bubble yet – but investors should be wary

Indonesia's prospects look good for investors who can tough it out for the long term. But beware: compared to other Asian markets, Indonesia is extrememly volatile. And with Jakarta's stockmarket hitting record highs, a big sell-off is likely at some point, says Cris Sholto Heaton.

It's been a tale of two cities for me in the last 48 hours. Or perhaps a tale of two commutes. From Singapore's Changi airport, the metro whisks you quickly past hundreds of housing blocks and offices. There are no public signs of poverty; everything is clean, safe and organised.

The contrast within Indonesia is striking. From Jakarta's Soekarno-Hatta, your Bluebird taxi the only firm that most foreign visitors would consider using navigates traffic-clogged roads. Out of the window, tall modern towers, canal-side slums and everything in between roll into view. Shopping centres, hotels and condominiums form islands of wealth amid appalling poverty.

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Cris Sholto Heaton

Cris Sholto Heaton is an investment analyst and writer who has been contributing to MoneyWeek since 2006 and was managing editor of the magazine between 2016 and 2018. He is especially interested in international investing, believing many investors still focus too much on their home markets and that it pays to take advantage of all the opportunities the world offers. He often writes about Asian equities, international income and global asset allocation.

Cris began his career in financial services consultancy at PwC and Lane Clark & Peacock, before an abrupt change of direction into oil, gas and energy at Petroleum Economist and Platts and subsequently into investment research and writing. In addition to his articles for MoneyWeek, he also works with a number of asset managers, consultancies and financial information providers.

He holds the Chartered Financial Analyst designation and the Investment Management Certificate, as well as degrees in finance and mathematics. He has also studied acting, film-making and photography, and strongly suspects that an awareness of what makes a compelling story is just as important for understanding markets as any amount of qualifications.