"Too Dismal": KOSDAQ's Market Cap Trails Even SK Hynix in a Brutal History

Started at 1,000 in 1996... Still hovering around 1,100

"Too many listed companies and zombie firms kept alive"

Government prepares measures such as tougher delistings and incentives for institutional investors

The KOSDAQ was launched in July 1996 to help small and venture companies raise capital. As its name suggests, it was created by benchmarking the U.S. NASDAQ.

Although KOSDAQ has more listed companies than KOSPI, their combined market capitalization amounts to only 623 trillion won. It does not even reach SK Hynix's 675 trillion won, let alone Samsung Electronics, whose market capitalization exceeds 1,200 trillion won. Getty Images

Although it has taken NASDAQ as its role model, KOSDAQ’s report card is disappointing. It started at an index level of 1,000 and once climbed to 2,925 points during the IT bubble in 2000. However, when the bubble burst, it plunged to 245 points during the 2008 global financial crisis, just one-tenth of its peak. It has since recovered little by little, but it is still hovering around 1,100 points. Even though 30 years have passed since its launch, its cumulative gain is just over 10%. This is a poor performance compared with the KOSPI, which has risen more than ninefold over the same period.

On February 23, the KOSPI surpassed 5,900 for the first time ever, but the KOSDAQ is still hovering in the 1,160-point range. 2026.2.23 Kang Jinhyeong, Reporter

Excessive numbers of listed companies relative to the market’s capacity and weak earnings are cited as reasons why KOSDAQ is not rising. There are currently 1,810 KOSDAQ-listed stocks, more than double the 839 listed on the KOSPI. Although this is fewer than the roughly 3,300 stocks listed on the U.S. NASDAQ, the securities industry views it as an excessive number when considering the size of the Korean economy.

Global giants such as Nvidia, Apple, Alphabet, Microsoft (MS), and Meta are listed on NASDAQ in large numbers. By contrast, KOSDAQ does not have a single company of that stature. NCSoft, Naver, Kakao, and Celltrion have all left KOSDAQ, and even Alteogen, currently the second-largest company on KOSDAQ by market capitalization, plans to leave KOSDAQ and switch its listing to the KOSPI.

Although the number of KOSDAQ-listed stocks is higher than that of the KOSPI, their combined market capitalization is only 623 trillion won. It does not even reach SK Hynix’s 675 trillion won, let alone Samsung Electronics, whose market capitalization exceeds 1,200 trillion won. Kim Hakgyun, Head of Research at Shinyoung Securities, analyzed, “KOSDAQ’s long-term performance has been weaker than that of the KOSPI,” adding, “We basically need to reflect on whether too many companies are being listed.”

The government, sharing this perception, has moved to structurally improve the KOSDAQ market. The Financial Services Commission has begun in earnest this year to overhaul KOSDAQ’s fundamentals by strengthening the delisting of poorly performing KOSDAQ-listed firms, improving conditions for institutional investor participation, and revitalizing initial public offerings (IPOs) by promising companies. From the second half of this year, it also plans to start delisting so-called “penny stocks” with share prices below 1,000 won.

Kwon Daeyoung, Vice Chairman of the Financial Services Commission, stressed, “For KOSDAQ to make a great leap forward as a market trusted by investors, there must be faster and stricter delisting of insolvent companies.” Jeong Eunbo, Chairman of the Korea Exchange, also said at a press briefing on the 5th, “Removing zombie companies from the stock market is the top priority for the exchange,” and pledged, “We will quickly delist poorly performing listed companies from the market.”

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