Retail investors’ debt-financed investing expands, credit balance 37trillion7,376hundred million won
According to data compiled by the Korea Financial Investment Association, 6month 4day, the balance of credit financing for stock purchases, combined across the KOSPI and KOSDAQ markets, stood at 37trillion7,376hundred million won. Unsettled receivables from brokerage transactions stood at 1trillion8,293hundred million won. Concerns over forced liquidation are spreading amid uncertainty over exchange rates and interest rates, as well as views that semiconductors have peaked.
Fear of forced liquidation is spreading in the domestic stock market. According to data compiled by the Korea Financial Investment Association, as of 6month 4day, the balance of credit financing for stock purchases in the KOSPI market stood at 28trillion317hundred million won. It increased by 3trillion won in a month, reaching a record high.
The total credit balance, including KOSDAQ, stood at 37trillion7,376hundred million won. This was the second-highest figure after 29day of last month, when it reached 38trillion227hundred million won. The credit balance is an indicator used to gauge the scale of debt-financed investing by individual investors.
Credit financing for stock purchases refers to the amount investors borrow from securities firms to buy stocks and have not repaid. Very short-term margin transactions are also increasing. Unsettled receivables from brokerage transactions stood at 6month 4day, at 1trillion8,293hundred million won.
The market is concerned that volatility will increase due to uncertainty over exchange rates and interest rates, as well as expectations that the semiconductor cycle may have peaked. As the scale of debt-financed investment has grown, an increase in volatility could also raise the possibility of forced selling. This is heightening investors’ anxiety.
These statistics were released at a time when market volatility had increased while investors had expanded their leverage. It has been pointed out that increases in credit balances and unsettled receivables could be linked to liquidation pressure. The figures compiled by the Korea Financial Investment Association are one indicator of market risk.
Sources: 파이낸셜뉴스 증권
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