'Inverse' ETF Ranks 2nd in Net Buying During Jisu Rebound
Over 1 Trillion Won Poured into ETFs Betting on KOSPI Index Decline
Seegene Faces 100 Billion Won Locked at 100,000 Won Level
[Asia Economy Reporter Oh Ju-yeon] Among individual investors who led the domestic stock market rebound last March, some have not been able to smile despite the KOSPI recovering to the 1700 level. These are investors who invested inversely in index-linked Exchange Traded Funds (ETFs). When the index fell, they poured money into leveraged ETFs that profit when the index rises, and from the time the rebound began in earnest, they shifted funds into inverse ETFs that profit when the index falls. In the KOSDAQ market, latecomers who jumped into 'Seegene,' which soared to third place in market capitalization due to COVID-19 diagnostic kits, are currently holding losses amounting to 100 billion won on shares bought in the 100,000 won range.
According to the Korea Exchange on the 3rd, the KOSPI, which was at 2002.51 on the 2nd of last month, dropped 27.21% to 1457.64 on the 19th. During this period, individual investors purchased stocks worth 8.6277 trillion won in the securities market. The most purchased stocks were Samsung Electronics (3.9661 trillion won), KODEX Leverage (1.6848 trillion won), Hyundai Motor (608.8 billion won), SK Hynix (548.3 billion won), and KODEX KOSDAQ150 Leverage (435.6 billion won). Samsung Electronics shares bought by individuals, who were even called 'Donghak Ants' during the index decline, fell 21.91% from 55,000 won to 42,950 won during this period.
Every time the index fell, individuals bought leveraged ETFs. They increased their holdings so much that KODEX Leverage ranked second in net purchases due to expectations of a rebound, but KODEX Leverage halved from 11,210 won to 6,450 won during this period. The KOSDAQ index showed a similar trend. KODEX KOSDAQ150 Leverage, which was the fifth most net purchased stock by individuals, dropped 47.04% from 7,515 won to 3,980 won.
The turnaround occurred from the 20th. The KOSPI surged 20.38% from its low to close at 1,754.64 on the 31st, so if investors had held onto their leveraged ETFs until then, they could have recovered some losses. However, from the 20th to the 31st, when the index rebound became full-fledged, the top net purchased stocks by individuals shifted from leveraged ETFs to inverse ETFs.
During the index rebound, individuals bought 970 billion won worth of KODEX 200 Futures Inverse 2X, ranking it second in net purchases. This product peaked at over 12,000 won on the 19th but has since plunged 30.83% to around 8,300 won. KODEX Inverse, the fourth most purchased with 249.7 billion won, also fell from a closing price of 8,465 won on the 20th to 7,500 won on the 31st.
They also bet inversely on the recently sharply rising KOSDAQ index. They dumped the leveraged ETFs accumulated in early March and invested in inverse products. KODEX KOSDAQ150 Futures Inverse, ranked fifth in net purchases with 205.7 billion won, dropped 16.76% from a closing price of 9,575 won on the 20th to 7,970 won on the 31st.
In particular, individuals invested 270 billion won in KODEX WTI Crude Oil Futures, expecting a rebound with the belief that "there will be no further decline" in the endlessly falling crude oil prices. Since the price had already dropped significantly from 15,890 won at the beginning of the month to the 9,000 won range, expectations for a rise were high. However, the price fell 21.79% from a closing price of 9,225 won on the 20th to 7,215 won on the 31st.
Meanwhile, in the KOSDAQ market, interest in diagnostic kits surged due to the COVID-19 issue, leading to focused buying of Seegene, which rose to third in market capitalization. Especially between the 26th and 31st, when Seegene surged, individuals purchased 108.5 billion won worth of shares. Considering that the intraday low on the 25th was 103,100 won, the price soared to 140,000 won on the 27th, and the intraday low on the 31st was 104,600 won, even if individuals bought at the cheapest prices during this period, they effectively bought in the 100,000 won range and are currently recording negative returns. As of 10:40 AM on that day, Seegene was trading at 90,700 won.
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