Retail Investors Bet 11 Trillion Won on Samsung Electronics with ‘AI Conviction’ as Foreigners Dump 10 Trillion Won
Samsung Electronics headquarters.
Despite the stock market plunge triggered by the U.S.-Iran war, retail investors (gaemi) are buying up stocks in large quantities. They are particularly focused on purchasing bellwether semiconductor stocks like Samsung Electronics and SK Hynix, countering the massive exodus of foreign investors.
According to the Korea Exchange on March 24, retail investors have purchased stocks worth 26.2505 trillion won (approximately $17.8 billion) this month. This is a record-high net purchase, surpassing the 22.3384 trillion won recorded in January 2021.
The buying intensity grew stronger as stock prices plummeted. On March 3, the first trading day after the war broke out, when the KOSPI plunged by 7.24%, retail investors bought 5.7974 trillion won in a single day. On March 23, when the KOSPI fell an additional 6.49%, they net-purchased 7.0028 trillion won, setting a new single-day record.
A noteworthy point is that approximately 44% of retail investors’ total net purchases in the securities market this month, amounting to 11.6085 trillion won, were concentrated in a single stock: Samsung Electronics. In other words, every time the stock price fell, retail investors rushed to buy Samsung Electronics.
On March 24, Samsung Electronics successfully rebounded, driven by net buying from retail investors. On this day, the KOSPI index closed at 5553.92, up 2.74% from the previous day.
The reason for retail investors’ focus on Samsung Electronics is clear. This is because performance improvement is becoming evident due to the expansion of demand for AI semiconductors. The profit growth of large semiconductor stocks like Samsung Electronics and SK Hynix was also the backdrop for the KOSPI’s sharp rise before the war.
The pattern is not unfamiliar. During the ‘Donghak Ant Movement’ in January 2021, retail investors also bought Samsung Electronics the most (10.1564 trillion won) and set a record for the highest-ever monthly total net purchase by retail investors at 22.3384 trillion won. This month, retail investors easily surpassed this record with net purchases of 26.2511 trillion won.
On the other hand, foreign investors net-sold Samsung Electronics shares worth 10.5390 trillion won during the same period. This creates a situation where foreigners are selling off as much as retail investors are buying. The total net selling by foreigners in the securities market this month reached 22.2570 trillion won, already exceeding the previous monthly record of 21.0730 trillion won set last month.
The proportion of shares held by foreign investors in the KOSPI market is also decreasing. According to Yonhap Infomax, as of March 23, the market capitalization of stocks held by foreigners in the KOSPI market was 1,663.6090 trillion won, accounting for 37.32% of the total market capitalization. The foreign ownership ratio, which was 38.10% on the 26th of last month, has dropped to the 37% range this month.
Dependence on crude oil imports and currency exchange rate risks are cited as the background for the foreign exodus. This month, the won-dollar exchange rate rose by 3.85% based on the weekly closing price, and on March 23, it broke through 1,510 won during trading hours, hitting its highest level in about 17 years.
Amid this, the increasing number of retail investors taking on debt to buy stocks is also a cause for concern. According to the Korea Financial Investment Association, the balance of margin loans as of the 20th was 32.3605 trillion won, comprising 21.7436 trillion won in the KOSPI and 10.6169 trillion won in the KOSDAQ.
Notably, margin funds were concentrated in top market-cap semiconductor stocks, with 2.9813 trillion won in Samsung Electronics and 2.1045 trillion won in SK Hynix. This is why voices are calling for caution, as geopolitical risks from the Middle East due to the U.S.-Iran war continue.
Kim Seok-hwan, a researcher at Mirae Asset Securities, analyzed, “President Trump’s grace period for the attack on Iranian power plants is this Friday (U.S. Eastern Time),” adding, “if there is no visible progress or news of a breakdown in negotiations by then, oil prices are highly likely to soar to a multi-year high again, and financial market volatility could increase further, requiring adjustments in the allocation to risky assets.”
Yoon Young-sil
댓글
0