South Korean retail investors are rapidly retreating from the stock market as sharp volatility weighs on sentiment, according to the Korea Exchange on Tuesday. Data showed that retail investors accounted for about 31.2% to 31.5% of trading value on the Korea Composite Stock Price Index, or KOSPI, in July, down sharply from 48.1% in January. That marks a decline of roughly 16 to 17 percentage points in six months. The exchange said even mild rebounds in the benchmark are now triggering selling, as investors try to recover principal and exit positions, accelerating capital outflows from the domestic market. Since June, retail investors have no longer been the dominant force in market trading. In July, foreign investors made up about 38% to 39% of KOSPI trading value, clearly above the retail share. Analysts cited the index’s heavy reliance on Samsung Electronics and SK Hynix as a key factor pushing individual investors away from the South Korean market.
South Korean retail investors are rapidly pulling out of the stock market as sharp market swings erode sentiment, the Korea Exchange said Tuesday.
Data showed that retail investors accounted for about 31.2% to 31.5% of trading value on the Korea Composite Stock Price Index, or KOSPI, in July, down sharply from 48.1% in January. The share fell by roughly 16 to 17 percentage points over six months.
The Korea Exchange said that even a mild rebound in the index is now enough to trigger selling, with investors seeking to recover their principal and exit the market. That has accelerated capital leaving South Korea’s domestic market.
Since June, retail investors have no longer been the market’s main trading force. In July, foreign investors accounted for about 38% to 39% of KOSPI trading value, clearly above the retail share.
Analysts said the KOSPI’s heavy dependence on two major companies, Samsung Electronics and SK Hynix, is an important reason individual investors are moving away from the South Korean market.
The report was cited by Jin10.
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