Personal Investors' Longest 'Palja' Streak This Year... Is the Net Buying Rally Coming to an End?

[Asia Economy Reporter Koh Hyung-kwang] Individual investors, who had volunteered as guardians of the domestic stock market, have recently been flooding the market with sell orders. Analysts suggest that the buying momentum of individuals, who had been purchasing stocks worth trillions of won every month, may have somewhat slowed down.

According to the Korea Exchange on the 12th, individual investors have net sold stocks worth a total of 1.2664 trillion won in the KOSPI market over four trading days from the beginning of this month to the 8th. This is a complete reversal of the buying pattern of individuals, who had been net buyers ranging from 2 trillion won to as much as 11 trillion won every month this year. So far this year, individuals have purchased more than 45 trillion won worth of stocks in the KOSPI market alone until last month.

Although the month is not yet halfway through, the fact that individuals have continued net selling for six consecutive trading days (totaling 1.4834 trillion won) from the 28th of last month to the 8th of this month has led to interpretations that individual buying power may have weakened. The six consecutive trading days of net selling by individuals is the longest selling streak since 14 consecutive trading days of net selling from December 6 to 26 last year. This year, individuals showed five consecutive days of net selling from June 1 to 5 but quickly returned to buying, recording net purchases exceeding 3.8 trillion won for the entire month of June.

The stock most sold by individuals this month was Samsung Electronics, with sales amounting to 334.2 billion won. Following were LG Chem (289.1 billion won), Kakao (211.4 billion won), POSCO (106.5 billion won), and Hanwha Solutions (87 billion won). It appears that individuals are realizing profits mainly from stocks whose prices have risen significantly.

In the securities industry, it is seen that individual investors are reflecting a mindset of avoiding risks and readjusting their investment positions ahead of uncertainties such as the U.S. presidential election. Seo Jung-hoon, a researcher at Samsung Securities, said, "With growing caution ahead of the U.S. presidential election, it is difficult to see a consistent buying trend. However, since expectations for global economic recovery and vaccines remain valid and liquidity conditions are unchanged from before, it is hard to conclude that individuals have turned to selling."

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