Korean retail investors' holdings in U.S. stocks have surpassed $100 billion for the first time, driven by a growing interest in large tech stocks and leveraged funds. According to data from the Korea Securities Depository, these investors held $101.4 billion worth of U.S. stocks as of November 7, marking a significant 64% increase from the previous year.
The downturn in the Korean Kospi Index, which has been one of the poorest performing indices globally this year, has prompted more individual traders to seek higher returns by investing directly in U.S. stocks. Despite efforts by authorities to revitalize the local stock market through enhanced corporate regulations, they have sold off benchmark index stocks worth 4.4 trillion won ($3.2 billion) so far in 2024.
Volatile sectors such as cryptocurrencies and tech stocks are the preferred investment targets for Korean retail investors. Tesla (TSLA, Financial) is particularly popular, with retail investors holding a total of $16.7 billion in the company. Other significant holdings include $13.8 billion in Nvidia (NVDA), $4.6 billion in Apple (AAPL), and $3.6 billion in Microsoft (MSFT).
Leveraged exchange-traded funds that track U.S. tech stocks have also gained popularity among traders.
