KOSPI soars high, stock market standby funds approach 130 trillion won

KOSPI hits new all-time highs for consecutive days, and the funds waiting around the stock market are once again approaching 130 trillion won.

According to the Korea Financial Investment Association on the 2nd, as of the 29th of last month, investor pre-deposits were recorded at 129.9574 trillion won. Investor pre-deposits are funds deposited into securities accounts by investors to purchase stocks, which typically increase along with rising market expectations. Recently, after the KOSPI first broke through 6,700 points and continued to push higher, this amount has increased for six consecutive trading days. It has rebounded to the highest level since the domestic stock market hesitated due to geopolitical instability on the 6th of last month.

Funds willing to take risks for higher returns are also growing simultaneously. Known as the “borrowed stock investment” indicator, the credit financing balance reached 36.0682 trillion won, surpassing 36 trillion won for the first time in history, and has increased for 14 consecutive trading days. The credit trading financing balance refers to the amount investors borrow from securities companies to buy stocks that have not yet been repaid. The average daily scale of credit financing last month also reached about 33.8 trillion won, setting a monthly record high. Although some securities firms are adjusting loan limits or temporarily halting credit loans, the inflow of funds seems to remain strong due to high expectations for rising markets.

The exchange-traded fund (ETF) market is also rapidly expanding. As of the 29th of last month, ETF net assets stood at 431.3841 trillion won, surpassing 430 trillion won. This is just two weeks after breaking through 400 trillion won for the first time on the 15th of last month, with an increase of over 30 trillion won. In the past week alone, it increased by 10 trillion won, and since April, it has expanded by about 20%. This scale is approximately 7.8% of the total KOSPI market capitalization on the same day (5,485 trillion won). This is interpreted as a sign that, compared to directly selecting individual stocks, investors are increasingly diversifying their investments into specific sectors or the entire market, and in rising markets, funds tend to flow more into easily tradable ETFs.

The flow of funds is very clear. The ETF that attracted the most funds in the past week is “HANARO Fn K- Semiconductor,” which raised 473.5 billion won. The “RISE Samsung Electronics SK Hynix Bond Hybrid 50,” which mixes Samsung Electronics, SK Hynix, and bonds, also received 345.4 billion won, while “KODEX Leverage” and “RISE Money Market Active” attracted 310.9 billion won and 294.4 billion won, respectively. This indicates that market expectations for the semiconductor industry, which leads the domestic stock market, remain strong. In terms of yields, the oil ETF had the highest average return in the past week (16.48%), followed by China’s STAR Market ETF at 10.79%. Due to the impact of soaring oil prices and expectations for alternative energy, hydrogen and solar energy-related ETFs also recorded returns of 7.99% and 7.27%, respectively. Conversely, Indonesia-related ETFs performed the worst (-8.98%), and aerospace-related ETFs also recorded -8.01%.

The simultaneous increase in deposits, credit financing, and ETF funds is interpreted as a significant sign of heightened market optimism. However, as the growth of waiting funds and leveraged funds accelerates, market volatility may also increase accordingly. If the KOSPI continues its upward trend, the phenomenon of funds concentrating into semiconductors, raw materials, and thematic ETFs may further intensify. But if geopolitical variables or interest rate environment changes occur, the inflow speed could change at any time.