Foreign investors have net sold nearly $110 billion worth of South Korean stocks this year, putting increasing pressure on retail investors to step in and buy.

Svmuu News: So far this year, foreign investors have withdrawn a cumulative total of nearly $110 billion from the South Korean stock market, setting a new record high. The main reason is to avoid an imbalance in their portfolio allocations caused by the rapid rise of the South Korean stock market. As a result, domestic retail investors in South Korea have shouldered the bulk of the buying. Following purchases of 42.4 trillion won in June, South Korean retail investors have made cumulative net purchases of 13.2 trillion won in KOSPI stocks this month.
As of July 14, the margin balance used by retail investors to invest in KOSPI stocks stood at 28 trillion won, having hit a record high of 29.8 trillion won on June 24.
Alexander Redman, chief equity strategist at CLSA, said: “ “South Korea remains the most overweight market in our portfolio, but I have begun to reduce our exposure. What concerns me is that the market is currently dominated by retail investors, as they are making heavy use of margin trading.” (Jin Shi)