Investor deposit accounts in South Korean stock markets fell below 120 trillion won as of July 2, marking the first time since April 16, according to data from the Korea Financial Investment Association released on July 4. The balance decreased approximately 20 trillion won in one month from the peak of 139.6947 trillion won recorded on June 4. Individual investors absorbed massive foreign selling during June 3-July 2, purchasing 55.2535 trillion won worth of stocks while foreigners net sold 55.0594 trillion won, which drew down cash reserves held in brokerage accounts.
Investor Deposit Accounts Record 119.9264 Trillion Won Balance
The Korea Financial Investment Association reported investor deposit accounts totaled 119.9264 trillion won as of July 2. The balance declined for three consecutive trading days, dropping below 120 trillion won for the first time since April 16, when it stood at 119.0742 trillion won. The current level represents a decrease of approximately 20 trillion won from the all-time high of 139.6947 trillion won recorded on June 4. Investor deposit accounts refer to cash held in brokerage accounts that has been deposited for stock purchases but remains uninvested, serving as a measure of retail investors' available buying power.
Individual Investors Net Buy 55.2535 Trillion Won in One Month
During the period from June 3 to July 2, foreign investors net sold 55.0594 trillion won worth of domestic stocks. Individual investors net purchased 55.2535 trillion won worth of stocks during the same period, absorbing most of the foreign selling. The deposit account balance decreased by more than 12 trillion won over the most recent three trading days. Despite the recent decline, the current deposit level remains more than 30 trillion won higher than the year-end balance of 87.829 trillion won.
Analysts Interpret Deposit Decline as Market Volatility Response
Kim Young-hwan, researcher at NH Investment Securities, stated that deposit accounts show synchronicity with stock prices, increasing during uptrends and decreasing during downtrends, noting that caution is needed when judging retail buying power based solely on deposit declines. Shin Seung-jin, head of the investment information team at Samsung Securities, analyzed that the deposit decrease could be interpreted as reduced risk appetite due to heightened market volatility, or alternatively as retail investors' standby funds flowing into bargain-hunting purchases following the recent market drop.
FAQ
What was the investor deposit account balance as of July 2?
The Korea Financial Investment Association reported investor deposit accounts totaled 119.9264 trillion won as of July 2, falling below 120 trillion won for the first time since April 16.
How much did individual investors buy during June 3-July 2?
Individual investors net purchased 55.2535 trillion won worth of stocks during June 3-July 2, while foreign investors net sold 55.0594 trillion won during the same period.
How did analysts interpret the deposit account decline?
NH Investment Securities researcher Kim Young-hwan stated that deposit accounts show synchronicity with stock prices and caution is needed when judging buying power based solely on declines, while Samsung Securities' Shin Seung-jin analyzed the decrease could reflect either reduced risk appetite or funds flowing into bargain-hunting purchases.
