South Korean Retail Investors Accelerate Stock Market Exit, Trading Share Drops to Six-Month Low

TechFlow news, August 4, the Korea Exchange said on Tuesday that as market volatility weakens investor sentiment, South Korean individual investors are rapidly withdrawing from the stock market. Data shows that in July, the proportion of individual investors in the Korea Composite Stock Price Index (KOSPI) trading volume was about 31.2% to 31.5%, a significant decrease from 48.1% in January. In just six months, the ratio dropped by about 16 to 17 percentage points.

The Korea Exchange stated that nowadays even a slight rebound in the index triggers sell-offs, as investors hope to recover their principal and exit, accelerating the outflow of funds from the South Korean domestic market. Since June, individual investors have no longer been the main force in market trading. In July, foreign investors accounted for about 38% to 39% of KOSPI trading volume, significantly exceeding retail investors.

Analysts pointed out that the KOSPI index's high reliance on the two leading companies, Samsung Electronics and SK Hynix, is an important reason causing individual investors to stay away from the South Korean market. (Jin10)