KOSDAQ Rebellion... Soaring Despite Concentrated Short Selling

Partial Resumption of Short Selling for 1 Year
Pearl Abyss Rises 31% Over 1 Year
Top 5 KOSDAQ Companies Average Increase of 53%

[Asia Economy Reporters Ji Yeon-jin, Hwang Jun-ho] Among companies heavily targeted by short selling over the past year, KOSDAQ stocks actually showed gains. KOSDAQ stocks that faced less aggressive short selling saw their stock prices perform poorly. In contrast, large-cap KOSPI stocks targeted by short sellers experienced significant declines, while those relatively free from short selling pressure outperformed the index.

On the 3rd, Asia Economy reported that since short selling resumed on May 3 last year until the 27th of last month, the stock with the highest cumulative short selling balance was Pearl Abyss (358.7 billion KRW). This stock rose 31.56% during this period. The average increase rate of the top 5 KOSDAQ stocks by short selling balance was as high as 52.60%. Conversely, stocks ranked within the bottom 10 in short selling balance (1.2 billion KRW) mostly recorded significant negative returns. ▶Related article page 6

In the KOSPI market, among KOSPI 200 stocks targeted for short selling, those with high short selling balances showed a marked decline in stock prices. The average stock return of the top 10 stocks by short selling balance over the past year was -21.81%, a larger drop compared to the KOSPI 200 index return of -16.47% during the same period. The 10 companies with lower short selling balances in KOSPI also performed relatively well, with an average return of -13.79%, outperforming the index.