Kim Yong-beom, Deputy Minister of Economy and Finance, "'Donghak Ant' Phenomenon Energizes Stock Market but May Increase Volatility"

Kim Yong-beom, Vice Minister of Strategy and Finance, is delivering opening remarks while presiding over the 'Macroeconomic Financial Meeting' held on the 16th at the Bankers' Hall in Jung-gu, Seoul.

[Asia Economy Reporter Joo Sang-don] Kim Yong-beom, the 1st Vice Minister of the Ministry of Economy and Finance, expressed concern that "the stock investment craze by individuals known as 'Donghak Ants' in Korea and 'Robinhood investors' in the United States is adding liquidity and vitality to the market, but it could also act as a factor increasing stock market volatility in the future."

On this day, Vice Minister Kim chaired a macroeconomic and financial meeting at the Seoul Bankers' Hall and said, "Under the low interest rate environment, abundant market liquidity continues, and with the activation of non-face-to-face online trading, a large number of new individual investors, mainly young people, are participating in the market."

He added, "Domestic and foreign new individual investors are generally young first-time investors who are proficient in information search and stock trading using online platforms, make investment decisions quickly, and prefer short-term investments. The government, together with related agencies, will pay closer attention to the impact of the increase in new investors on the stock market and investor protection going forward."

Regarding the recent financial market, he diagnosed that volatility is increasing not only in the global market but also in the Korean market. Vice Minister Kim said, "Following the easing of lockdown measures in major countries such as the United States and Europe, uncertainties about the global economic recovery are growing due to concerns over the resurgence of COVID-19, leading to increased volatility in global financial markets. The domestic financial market is also showing a 4.8% drop in stock prices the previous day and increased exchange rate volatility amid uncertainties surrounding the progression of COVID-19 and the direction of the real economy."

Vice Minister Kim stated, "Depending on upcoming real economy indicators, major countries' response measures, the development of US-China conflicts, emerging market debt risks such as Argentina, and whether the UK and EU reach an agreement on the Brexit transition period, the possibility of renewed volatility in global financial markets cannot be ruled out. We will closely monitor the risk factors present in domestic and international financial markets and, if necessary, actively utilize the already prepared financial market stabilization measures to ensure market stability."