Korean investors’ overseas equity investment exceeds $ 100 billion

The amount of foreign currency securities deposited with the Korea Securities Depository (KSD) exceeded US $ 100 billion for the first time in history.


Thanks to recent strong growth in cross-border direct equity investments by Korean investors, the amount of foreign currency securities deposited with the Korea Securities Depository (KSD) exceeded $ 100 billion for the first time in history.

According to the KSD, the amount of foreign currency securities in its custody stood at US $ 102.1 billion as of November 26.

The amount of foreign currency securities deposited with the KSD has increased more than tenfold over the past 190 years. It rose from $ 9.7 billion at the end of 2012 to nearly $ 40 billion at the end of 2017 and exceeded $ 70 billion at the end of 2020.

By market, the US stock market accounted for 67.4% with US $ 68.81 billion, followed by the euro market with 21.1% or US $ 21.55 billion. Hong Kong was worth 3.79 billion US dollars or 3.7 percent.

Along with the increase in the amount of foreign currency securities deposited, the settlement of foreign securities by Korean investors has also increased. In 2021, foreign equity settlements reached $ 441.2 billion, up 36.4% from $ 323.4 billion in 2020. The average annual growth rate over the past three years has reaches almost 60%.

In terms of settlement amount, US stocks made up 76.7% of the total, followed by European stocks with 17.4% and Hong Kong stocks with 3.4%.

Analysts say the increase in the number of Koreans investing in foreign stocks has been fueled by better access to foreign stock markets and increased interest in foreign stocks.

Korean investors preferred US tech stocks, including Tesla, in 2021. As of November 26, Tesla shares worth $ 14.82 billion have been deposited with the Korea Securities Depository.

Tesla was followed by Apple ($ 4.38 billion), Nvidia ($ 3.02 billion) and Google’s parent company Alphabet ($ 2.2 billion).

What is notable is that companies listed on the stock markets of Japan, China and Hong Kong have disappeared from the list of preferred foreign stocks by Korean investors. The top five stocks filed with the KSD in 2018 included Amazon, Japan-based Goldwin (US $ 450 million), Chinese company Heng Rui Pharmaceutical (US $ 310 million) and Tencent (US $ 250 million).


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