Individual Investors Left Behind in Bull Market, Suffering Losses in Newly Listed and Theme Stocks

Focused Net Buying of Linksolution, Kistron, and Now Robotics This Month
Losses Incurred from High-Risk Investments Aiming for Volatility on Listing Day
Time to Adopt Flexible Strategies Aligned with Government Policies

This month, the KOSDAQ index has risen by 7%, moving toward recovering the 800-point mark. The KOSPI has also reclaimed the 2,900-point level for the first time in three years and five months since January 2022. Since President Lee Jaemyung took office, expectations for new policies have improved investor sentiment. However, a significant number of individual investors have suffered losses after investing in newly listed companies and political theme stocks.

According to the financial investment industry on June 12, individuals have recorded a cumulative net selling of 865 billion won in the KOSDAQ market so far this month. While reducing their overall stock holdings, they have focused their net purchases on companies such as Peptron, Linksolution, Jusung Engineering, Kistron, and Olix.

From June 2 to June 11, individuals purchased 78.6 billion won worth of Peptron shares. The average purchase price was 169,700 won, and based on the previous day's closing price of 191,800 won, they have achieved a return of 13%. Among the top 15 companies by individual net purchases, Peptron has the highest return. Excluding Peptron, the returns on the other stocks are lower than the KOSDAQ index's rate of increase.

Individuals also bought 43.8 billion won worth of Linksolution shares, which was newly listed on the KOSDAQ on June 10. Given Linksolution's market capitalization of 127.8 billion won, the proportion of individual purchases is high. It appears that individuals bought the stock on the first day of listing, aiming for ultra-short-term gains amid high price volatility, but were unable to sell. As a result, individuals are currently facing a return of -26.4% within just two days.

Kistron was listed on June 2. Its IPO price was 3,600 won, and on the first day of trading, the price surged to 10,800 won. Over six trading days, individuals purchased 32.8 billion won worth of Kistron shares. After rising 168% above the IPO price on the first day, Kistron shares have declined for four consecutive days starting from the second day of trading.

Individuals who invested in Now Robotics, which was listed on May 8, have also suffered losses. As one month has passed since its listing, lock-up shares have been released, causing the stock price to decline this month. Individuals recorded a net purchase of 13.9 billion won this month and are facing losses of over 10%.

Even after the presidential election, individuals have continued to show interest in political theme stocks. For example, those who bought Sangi Construction, considered one of the stocks linked to President Lee Jaemyung's acquaintances, have suffered a return of nearly -20%.

In contrast to individuals, foreign and institutional investors have achieved solid investment results. Stocks that foreigners have concentrated on, such as Alteogen, Silicontwo, Pharmaresearch, and Saltlux, have all shown upward trends this month. Silicontwo, of which foreigners purchased 84.2 billion won, reached an all-time high in the previous trading session. Woori Technology Investment, which institutions net purchased 23.4 billion won, has risen by 48.3% this month.

Stock market experts advise that rather than pursuing the "high-risk, high-return" strategy favored by individual investors, it is time to respond flexibly to government policies. Lee Hayoung, head of research at KB Asset Management, said, "Recently, the domestic market has shown stable trends despite volatility," adding, "Financial sectors with potential for governance improvement, domestic consumption stocks, and certain consumer and bio sectors reflecting expectations for improved relations with China and the United States are likely to attract attention."