An Individual Who Bought 6 Trillion Won in One Month... The Largest Since Statistics Began

[Asia Economy Reporters Koh Hyung-kwang and Geum Bo-ryeong] It has been revealed that individual investors have purchased over 6 trillion won worth of stocks in the domestic stock market since the beginning of this year. Despite the stock market fluctuations caused by the novel coronavirus (Wuhan pneumonia) shock, individual investors seem to be taking this as an opportunity for bargain buying.

According to the Korea Exchange on the 31st, individual investors bought a total of 4.2043 trillion won worth of stocks in the KOSPI market up to the previous day this month. This is the largest monthly purchase amount by individuals since the Korea Exchange began compiling trading trend statistics by investor type in September 2001.

In contrast, during the same period, foreign investors' net purchases amounted to only 732.4 billion won, and institutions net sold 5.2454 trillion won. Last year, individuals net sold 11.8012 trillion won worth of stocks in the KOSPI market, including net sales of 3.2295 trillion won in December alone.

The selling trend among individuals has drastically changed since the beginning of this year. Starting from the first trading day on the 2nd, they began buying stocks worth over 530 billion won, showing a buying dominance on all but four of the 19 trading days.

In particular, on the 28th, when the KOSPI index plunged more than 3% due to concerns over the spread of the novel coronavirus, foreign and institutional investors sold 526.2 billion won and 189.4 billion won respectively, while individuals purchased a whopping 667.2 billion won worth of stocks. This is the second-largest net purchase amount in the past year.

Last year, individuals net purchased over 500 billion won only on two days: May 9 (815.7 billion won) and October 2 (502.2 billion won). However, this month alone, they have already bought over 500 billion won four times, and during the recent four trading days, they concentrated purchases amounting to 2.2844 trillion won, indicating a steady inflow of individual buying power.

In the KOSDAQ market as well, individuals net purchased 1.8015 trillion won worth of stocks this month. This exceeds the net sales by institutions (1.1687 trillion won) and foreign investors (533.2 billion won) during the same period. Combining KOSPI and KOSDAQ, the cumulative net purchase amount by individual investors this month reaches 6.0058 trillion won.

This movement by individual investors is interpreted as placing more weight on the potential for further price increases rather than the current stock price decline. Until the novel coronavirus situation, the domestic stock market had been continuously strong due to expectations of the US-China Phase One trade agreement and semiconductor market recovery. In particular, the KOSPI briefly surpassed the 2,260 level this month, marking the highest point in 15 months. Considering this, the recent sharp drop in stock prices due to the novel coronavirus issue is being viewed as a bargain buying opportunity.

Kim Yong-gu, a researcher at Hana Financial Investment, explained, "As the electronics and semiconductor sectors, which had shown strong upward trends for some time, experienced corrections due to profit-taking and the impact of the novel coronavirus, individual investors seem to have taken this as a buying opportunity." Han Dae-hoon, a researcher at SK Securities, also said, "Although fear of the novel coronavirus is affecting the stock market, the easing of the US-China trade dispute and continued expectations for domestic companies' earnings improvement this year are believed to be attracting individual buying power."

During this period, the top three stocks in terms of individual net purchases were Samsung Electronics, SK Hynix, and Samsung Electronics Preferred, with purchases of 1.1502 trillion won, 336.2 billion won, and 274.2 billion won respectively. This shows a focus on semiconductor stocks. Following these were SK Innovation (260.6 billion won), Kia Motors (194 billion won), Celltrion (166 billion won), S-Oil (164.3 billion won), HL Biopharma (128.1 billion won), and Korea Electric Power Corporation (100.1 billion won).

Unlike the falling Samsung Electronics stock price due to the novel coronavirus, Samsung Group funds attracted a large inflow of investment. Samsung Electronics' stock price, which was 62,300 won on the 22nd, dropped 8.19% to 57,200 won by the 30th within a week. On the other hand, money flowed into Samsung Group funds. According to the fund evaluation company FnGuide, the total assets under management of 24 domestic Samsung Group funds with over 1 billion won in assets increased by 200 million won in one day and 12.6 billion won in one week as of the 29th. This contrasts with the overall domestic equity funds, which saw a decrease of 98.8 billion won in one day and 508.1 billion won in one week during the same period.

The falling Samsung Electronics stock price is being evaluated as a "breather" period. Expectations remain that it will rise again. Lee Soon-hak, a researcher at Hanwha Investment & Securities, said, "It is unclear how the spread of the novel coronavirus will affect global IT demand. Earnings are expected to bottom out by the first quarter and begin to grow significantly in the second half. A short-term correction phase is expected to continue, and stock prices are anticipated to rebound starting around the time semiconductor prices become clearer in the second quarter."

This content was produced with the assistance of AI translation services.