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“I lost all my money to buy a new house. Now I can’t buy it and I can’t sell it.”
This is an article that is frequently posted on recent investment information cafes or bulletin boards. Individual investors who started investing in stocks for the first time in a surge after Corona 19 fell into a panic. It’s like getting lost in a plunge that you’ve never experienced before. As the market continued, where neither the buy button nor the sell button could be pressed easily, the average daily trading volume fell by a fifth compared to the beginning of last year.
○ Dropped trading volume
According to the Korea Exchange on the 27th, the average daily trading value of the domestic stock market (the total of KOSPI, KOSDAQ, and KONEX markets) in January was 20.37 trillion won, down 5.2% from the previous month and 52% from a year ago.
On the 26th, the transaction value of the KOSPI was only 8.9798 trillion won. Compared to the average daily transaction value of 42 trillion won in January of last year, the transaction value has decreased by one-fifth.
The reason individual investors are complaining that they “can’t buy or sell” is because the investment amount is inherited as growth stocks that individuals have been buying intensively since last year have fallen sharply. Ants in cacao this month(82,600 -4.95%), Krafton(264,000 -4.52%) Among the stocks that rose sharply last year, such as those with a decline rate of 30-50%, they concentrated on buying them. Kakao was the stock that individuals bought the most in the month of January. The average purchase price for an individual is 96,956 won. The closing price on the day was 82,600 won, down 14.81% from the average purchase price. Kakao Bank(39,650 -2.22%)11.3% of the average individual purchase price, Krafton and Hive(241,500 -3.98%)fell 24.56% and 18.44%, respectively. This is the result of individual investors who lacked experience in a bear market buying stocks whose stock prices have fallen prematurely. I started buying after seeing that it had reached the bottom, but the decline was more rapid.
Prospects of experts who advise that “there is no real profit to sell now” also discourage individuals from reorganizing their portfolios. This is because the KOSPI index is below 2806.6 points, which is the average 12-month forward price-earnings ratio (PER 10.09x) for the past 10 years.
○Ants complaining of ‘joo-depression’
As the mood in the stock market changed rapidly over the past month, the number of individual investors complaining of depression also increased significantly. In stock discussion rooms or stock information cafes, there are articles that say, “I slept late than I looked at the head of the United States, so I was late for work”, “I feel depressed every morning that starts with the stock market”, “I can’t take my eyes off the mobile trading system (MTS), so I’m late to work.” I lost and heard something from my boss.”
Experts are advising, “You should avoid the strategy of buying unconditionally because the stock price is cheaper than last year.” After the liquidity feast is over, a discount on growth stocks, which received a high premium only for their growth potential, is inevitable. It is not surprising that the discount rate exceeds 50% as the US central bank’s (Fed) tightening stance and one-off bad news overlap. Choi Jun-cheol, CEO of VIP Investment Asset Management, said, “Even though earnings are not supported, some stocks that have risen sharply last year will not be cut in half, but will be cut in tenths. It’s time to choose well.”
By Shim Seong-mi/Park Jae-won, staff reporter smshim@hankyung.com
