Last Year’s Overseas Stock Trading Hits 200 Trillion Won... Tesla Accounted for 3 Trillion Won

[Image source=Yonhap News]

[Asia Economy Reporter Koh Hyung-kwang] Last year, the amount of overseas stocks bought and sold by domestic investors in South Korea exceeded 200 trillion won. This figure surged fivefold compared to the previous year. The net purchase amount, calculated by subtracting the selling amount from the buying amount, reached 21.5 trillion won. This is analyzed as a result of domestic investors turning their attention overseas and actively purchasing global stocks as the global stock markets fluctuated due to the impact of the novel coronavirus disease (COVID-19).

According to the Korea Securities Depository on the 4th, the total settlement amount (buying + selling) of overseas stocks by domestic investors from January 1 to December 31 last year was $198.322 billion (approximately 215.77 trillion won). This represents a 383.9% increase compared to the overseas stock settlement amount of $40.985 billion (44.59 trillion won) in the previous year.

The overseas stock settlement amount, which was only $3.1 billion in 2011, first exceeded $10 billion in 2015 with $13.9 billion. Although it slightly slowed to $12.6 billion in 2016, it continued to grow for three consecutive years with $22.7 billion in 2017, $32.5 billion in 2018, and $40.9 billion in 2019, increasing by about $10 billion each year. However, last year, due to the spread of COVID-19 and the sharp decline in major global stock markets including the U.S., individual investors seeking buying opportunities at the bottom entered the stock market en masse, pushing the settlement amount close to $200 billion.

The net purchase amount was $19.734 billion (21.47 trillion won), a 685.9% increase compared to the previous year’s $2.511 billion (2.73 trillion won). This amount corresponds to half of the net purchase amount by individual investors in the KOSPI market last year, which was 47.49 trillion won. The main focus of investors purchasing overseas stocks was the United States. They bought $17.767 billion (19.33 trillion won), accounting for 90% of the total net purchase amount. This was followed by China ($1.122 billion), Hong Kong ($880 million), and Japan ($162 million). On the other hand, there was a net sale of $64.43 million in the Euro market.

Among the top 50 stocks by net purchase, 82% (41 stocks) were companies listed on the U.S. stock market, showing that domestic investors heavily bought U.S. stocks. Japan (5 stocks), Hong Kong (3 stocks), and China (1 stock) also appeared among the top stocks. The number one was Tesla, an electric vehicle company, with a net purchase of $3.01 billion (3.26 trillion won). This investment amount is even higher than Hyundai Motor, which ranked third in net purchases by individuals in the domestic stock market last year (2.59 trillion won). Next were Apple ($1.899 billion, 2.06 trillion won), Amazon ($833 million, 900 billion won), and Nvidia ($647 million, 700 billion won).

Hwang Seung-taek, a researcher at Hana Financial Investment, said, "As the U.S. stock market, which had plummeted due to the impact of COVID-19, rebounded, domestic investors appear to have aggressively purchased stocks." He added, "Since the Korean stock market accounts for only about 2% of the global market capitalization, investing in overseas stock markets seems to be viewed as an opportunity to find greater profits."

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