Business · Markets · 4 hrs ago
South Korean investors’ unused brokerage cash falls to yearly low
Unused cash in South Korean brokerage accounts fell to 88.7 trillion won on Oct.
22, its lowest level this year.
This money is cash investors have placed in their accounts but have not yet used to buy investments.
It has fallen by 51 trillion won, or 36.5%, since reaching a record high on June 4.
Since then, individual investors have bought more than 44 trillion won in KOSPI-listed shares, as well as shares on the KOSDAQ market and exchange-traded funds.
This suggests much of the missing cash was invested rather than moved back to banks, leaving some investors’ money tied up in shares during a market downturn.
Less cash waiting on the sidelines could leave the market more exposed to pressure, especially when foreign investors are selling.
The figures do not say what will happen next, but further declines in unused cash could limit new buying in the market.
South Korean investor deposits held in brokerage accounts fell to 88.68 trillion won on Oct. 22, their lowest level this year.
The balance was down 36.5 percent, or about 51 trillion won, from its record high on June 4.
Since that peak, individual investors have bought more than 44 trillion won net in shares listed on the Korea Exchange, as well as shares and exchange-traded funds.
An industry official said much of the cash may have been used to buy stocks rather than moved back to banks.
The decline could leave the market more exposed to downward pressure because less cash is available to support share prices.
- Who
- South Korean individual investors.
- What
- Unused cash in brokerage accounts fell to 88.68 trillion won, its lowest level this year.
- When
- The balance was measured on Oct. 22, after falling from a record on June 4.
- Where
- South Korea’s brokerage accounts and stock markets.
- Why
- Investors used cash to buy stocks and exchange-traded funds; the sources say much of the money may remain invested.
This story does not have two clearly opposing sides.
Investor deposits reached a record 139.69 trillion won.
Deposits fell below 90 trillion won for the first time in more than nine months.
Deposits stood at 88.68 trillion won, the lowest level this year.
Individual investors had bought a net 44.17 trillion won in shares listed on the Korea Exchange since June 4.
- Deposits on Oct. 22
- 88.68 trillion won
- Record deposits
- 139.69 trillion won on June 4
- Decline from record
- 36.5 percent, or about 51 trillion won
- Net purchases on the Korea Exchange
- 44.17 trillion won since June 4
- ETF net purchases
- 28.25 trillion won since June 4
1 source
What people are saying
This means that funds for stocks are unlikely to have moved back to banks and other places in large amounts.