Photo courtesy of Yonhap News

 

[Alpha Biz= Paul Lee] South Korea’s benchmark stock index has continued to hit record highs, pushing margin trading—so-called “debt-driven investing”—to an all-time peak.

According to the Korea Financial Investment Association on the 29th, outstanding margin loans in the domestic stock market reached KRW 35.6 trillion as of April 28, rising by about KRW 2.7 trillion this month alone and extending gains for 13 consecutive trading days.

Amid overheating concerns, major brokerages including NH Investment & Securities and KB Securities have already restricted margin lending, while Korea Investment & Securities plans to temporarily suspend new margin trading agreements starting April 30.

While the surge reflects strong bullish sentiment, market participants warn that elevated leverage could amplify volatility if a short-term correction occurs.

 

 

 

 

AlphaBIZ Paul Lee(hoondork1977@alphabiz.co.kr)