Net purchases by "seohak ants," Korean retail investors who invest in U.S. stocks, quadrupled this month from the previous month, indicating stronger buying momentum in the U.S. stock market.
According to the Korea Financial Investment Association and the Korea Securities Depository, investor deposits stood at 104.2975 trillion won as of the 23rd of this month.
Investor deposits hit a record high of 139.6948 trillion won on the 4th of last month. They gradually declined thereafter, falling to 103.8765 trillion won on the 22nd. This was the lowest level in about five months since February 13 this year (99.2735 trillion won). Deposits rebounded slightly on the 23rd but remain precariously close to falling below the 100 trillion won mark.
By contrast, net purchases of U.S. stocks by Korean investors from the 1st to the 23rd of this month (based on the inquiry date) reached $2.50326 billion (about 3.7114 trillion won), four times the previous month's $632.96 million (928.4 billion won).
Net purchases of U.S. stocks by seohak ants shifted from net buying of $1.6915 billion in March this year to net selling of $468.93 million in April, with net selling expanding to $939.77 million in May. It turned back to net buying in June, and the margin expanded significantly this month.
Analysts note that while seohak ants had returned to domestic stocks due to government policy, the KOSPI's upward trend, and high exchange rates, their departure from the domestic market is accelerating again amid the recent bearish market.
By stock, the top net purchase settlement (as of the 23rd inquiry date) was "Soksl" (DIREXION DAILY SEMICONDUCTORS BULL 3X SHS ETF), an ETF that tracks three times the daily return of the U.S. Philadelphia Semiconductor Index, at $1.50023 billion (2.1978 trillion won).
SK hynix's American depositary receipts (ADR) followed at $613.67 million (899 billion won), and "Koru" (DIREXION SHARES ETF TRUST DAILY MSCI SOUTH KOREA BULL), which tracks three times the performance of the Korean stock market, at $213.37 million (312.6 billion won).
Funds are also flowing into exchange-traded funds (ETFs) listed in Korea that track major U.S. indexes. According to Koscom's ETF CHECK, three of the top five funds by net inflow over the past week were ETFs tracking major U.S. indexes such as the Standard & Poor's (S&P) 500 or the Nasdaq 100.
"TIGER U.S. S&P500" saw the largest net inflow at 221.4 billion won, followed by "TIGER U.S. Nasdaq100" (143.9 billion won) and "KODEX U.S. S&P500" (139.2 billion won) in third and fourth place, respectively.
The margin loan balance, an indicator of "debt investment" (investing with borrowed money), stood at 32.7492 trillion won on the 23rd, down 1.8% from 33.3624 trillion won on the last trading day of the previous week.
