Unchanged 'Seohak Ants'... Record High Domestic Overseas Securities Investment in January

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Eun-byeol] Amid the ‘Seohak Gaemi’ craze, the increase in overseas stock investments by domestic investors reached an all-time high.

According to the ‘January 2021 Balance of Payments (Provisional)’ financial account released by the Bank of Korea on the 9th, the amount of domestic investors’ investments in overseas stocks and debt securities (bonds) increased by a total of $10.95 billion in January. The previous largest increase was $10.93 billion recorded in January 2018. Among domestic investors’ overseas securities investments, stock investments amounted to $9.55 billion, also showing an all-time high. This surpassed the previous record increase in overseas stock investments of $8.28 billion recorded in October 2007. Overseas bond investments also increased by $1.39 billion.

Institutional investors such as the National Pension Service and funds also contributed to the increase in overseas securities investments, but the influence of individual investors was absolute. Lee Sung-ho, head of the Financial Statistics Department at the Bank of Korea, said, “Looking at the main participants in stock investments, more than half were households (individuals),” and added, “I hope (individuals) invest within a range where risk management is possible.”

During the same period, foreign investors’ domestic stock investments decreased by $1.79 billion, marking a decline for two consecutive months. Foreign investors’ domestic bond investments increased by $4.09 billion, turning to an increase after three months. While domestic investors ventured into overseas stock investments, foreign investors realized gains on domestic stocks.

In the new year, with continued export growth in semiconductors, automobiles, and other sectors, the current account surplus in January recorded $7.06 billion. While global trade recovered, the sharp decline in overseas travelers and increased transportation income reduced the deficit in the service account. The service account deficit in January was $610 million, reducing the deficit by $2.38 billion compared to the same month last year (-$2.99 billion). The surplus continued for nine consecutive months, and the surplus amount grew more than 12 times compared to January last year ($580 million).

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