Foreign investors have net sold nearly $110 billion in South Korean stocks this year, increasing pressure on retail investors to absorb the supply.

Odaily Planet Daily News Since the beginning of this year, foreign investors have cumulatively withdrawn nearly $110 billion from the South Korean stock market, hitting a record high. The primary reason is to avoid imbalances in their portfolio allocations caused by the rapid rise of the South Korean stock market. This has forced domestic retail investors in South Korea to absorb the majority of the buying pressure. Following purchases of 42.4 trillion won in June, South Korean retail investors have net bought 13.2 trillion won worth of KOSPI stocks this month as of the latest data.

As of July 14, the balance of margin loans used by retail investors to invest in KOSPI stocks stood at 28 trillion won, down slightly from the record high of 29.8 trillion won set on June 24. French

Alexander Redman, chief equity strategist at CLSA France, stated, "South Korea remains the most overweight market in our portfolio, but I have started to reduce positions. What concerns me is that the market is currently predominantly driven by retail investors, largely due to their extensive use of margin trading." (Jinshi)