"Everyone Is Buying and Selling"... This 'Product' Delivers Huge Returns with 100 Trillion Won in Trading

Due to the booming domestic stock market, exchange-traded funds (ETFs) specializing in securities are also showing high returns. The news that both the average daily trading volume and customer deposits have reached record highs has propelled the returns of securities ETFs even further.

Due to the booming domestic stock market, exchange-traded funds (ETFs) are also showing high returns. Getty Images

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According to Koscom ETF Check on March 12, the previous day's top-performing ETFs, excluding leveraged and inverse products, were dominated by the securities theme. The leading "TIGER Securities" ETF rose by 6.85% that day, followed by "KODEX Securities" at 6.78%, "HANARO Securities High Dividend TOP3 Plus" at 6.08%, and "WON Mega-cap IB & Financial Holding" at 5.20%. Among these, WON Mega-cap IB & Financial Holding included securities stocks such as Mirae Asset Securities (20.67%), Kiwoom Securities (10.53%), and NH Investment & Securities (10.38%) in its portfolio, while the remaining approximately 58% was allocated to financial holding companies.

Although the upward trend briefly paused due to geopolitical tensions in the Middle East, securities ETFs have posted strong returns overall this year. TIGER Securities recorded a return of 81.68% year-to-date, KODEX Securities achieved 80.31%, and HANARO Securities High Dividend TOP3 Plus delivered 80.08%, placing them fourth to sixth among all non-leveraged, non-inverse ETFs. While past evaluations considered structural growth difficult for securities, the sector now stands alongside high-growth themes like semiconductors, nuclear energy, and aerospace.

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The surge in domestic market activity this year is cited as the background for these results. According to LS Securities researcher Jeon Baekyung, "The average daily trading volume has reached a historic level, rising from 62 trillion won in January to 69 trillion won in February, and to 102 trillion won this month." She added, "Immediately after the outbreak of war, the daily trading volume in the domestic stock market soared to as high as 120 trillion won."

Customer deposits have also reached all-time highs. After surpassing 100 trillion won at the end of January, the figure exceeded 120 trillion won on March 3 and quickly rose to 132 trillion won on March 4, illustrating how index gains and increased volatility are driving inflows of funds into the stock market.

Some analysts note that this trend resembles the "money move" from banks to securities that occurred in 2007. Jang Youngim, a researcher at SK Securities, said, "In 2007, the stock market boom, fund craze, and the spread of Comprehensive Asset Management Accounts (CMA) led to a money move, and the price-to-book ratio (PBR) valuation of the securities industry rose to as high as 2.6 times. The current phase is similar." She further pointed out the following: ▲ The surge in the KOSPI index is accompanied by an explosive increase in trading volume; ▲ The ETF market is experiencing rapid growth comparable to the fund boom of 2007; ▲ There is a pronounced money move from the retirement pension market into securities.

Accordingly, brokerage revenues for securities companies are also expected to surge. Researcher Jeon noted, "From January to March this year, the average daily trading volume was 78 trillion won, up 110% from 37 trillion won in the fourth quarter of last year, and up 196% from the annual average of 26 trillion won last year." She predicted, "First-quarter brokerage fee income in the domestic stock market is expected to triple compared to last year's annual average."

Woo Dohyeong, a researcher at Yuanta Securities, stated, "Looking ahead, as concerns over war ease and as the KOSDAQ active ETF and single-stock leveraged ETF products are launched, both institutional and retail turnover rates are likely to rise." He maintained a "buy" recommendation on the securities sector.

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