15% of working adults invest
Growth in the number of people investing in the Kosdaq last year offset a decrease in the number investing in the main exchange.Investment in the Kospi has fallen due to rising indirect investment, such as in mutual funds.
According to the Korea Exchange, the number of individual stock investors rose 2.2 percent last year to 3.6 million. The number accounts for 15 percent of the economically active population.
The number of individual shareholders investing in the main exchange declined 0.6 percent, or by 15,000, but the number of shareholders investing in the secondary Kosdaq market rose 10 percent, or by 150,000.
“The popularity of indirect investment through mutual funds contributed to the drop in the number of investors for the main exchange, but young investors buying shares at the Kosdaq market increased,” said Myeong In-sik, a manager of the Korea Exchange.
According to the Asset Management Association of Korea, the total mutual funds balance increased to 233.7 trillion won ($251 billion) as of April 27, up from 224 trillion won in April 2006. The number of total mutual fund accounts stood at 13.7 million as of March.
Installment fund accounts make up 60 percent, or 8.3 million, of the total number of mutual fund accounts, and the total balance of the installment fund accounts was 30.4 trillion won as of March. The association said the number of installment fund accounts continued to increase due to the popularity of international mutual funds.
The average age of individual shareholders dropped a little to 45.6 at last year’s end from 46.7 at the end of 2005, due to a rise in the number of young Kosdaq investors, the Korea Exchange said. However, those in their 40s and 50s still own 58 percent of the entire market capitalization.
Individual investors own an average of 45.3 million won worth of stocks while investors in their 60s have 69.4 million won on average.
As a whole, institutional investors increased their clout in the stock market. Their ownership accounts for 21 percent of the entire market capitalization at last year’s end, up from 18.6 percent in December 2005. Foreign investors owned 35.2 percent at the end of last year, down from 37.2 percent. Individual investors accounted for 22 percent at last year’s end, down from 22.6 percent.
“In general, investment trusts, insurance and pensions are growing their presence in the local stock market, and it is becoming similar to stock markets in developed countries,” Myeong said.
By Limb Jae-un Staff Writer [jbiz91@joongang.co.kr]
with the Korea JoongAng Daily
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