The investment revenue of foreign retail investors who had been thriving until last year has worsened this year due to a sharp decline in the U.S. stock market. Among the top 50 stocks most purchased by foreign retail investors since the high point in December last year, 44 (88%) showed an average evaluation revenue of negative (-). This means they are continuing to engage in so-called 'averaging down' to lower their average purchase price amid declining stock prices.
According to the Korea Securities Depository on the 8th, the stocks most purchased by domestic investors from December 16 last year (settlement date December 18) when the Nasdaq Composite Index peaked to March 3 this month (settlement date March 7) were Tesla. Domestic investors net purchased $2.8458 billion (approximately 4.1 trillion won) worth of Tesla shares.
However, during the same period, Tesla's stock price plummeted from $463.02 to $267.28. The current stock price has fallen to $233.29, effectively halving. The number of investors incurring losses has surged. The average evaluation revenue of 307,553 Tesla investors linked with Naver Pay's 'My Assets Service' is -11.51%.
The average evaluation revenue of investors in the exchange-traded fund (ETF) 'TSLL,' which tracks Tesla's daily stock price increase rate at double, has plummeted to -55.48%. Domestic investors also net purchased $1.96869 billion (approximately 2.9 trillion won) worth of TSLL after it peaked. The average revenue of investors in 'TSLY,' a covered call ETF based on Tesla shares, was also weak at -42.03%.
'SOXL', an ETF known among domestic investors by the nickname 'Soksul,' has also shown poor performance, with an average revenue of -65.13% for 30,959 investors. SOXL tracks the daily increase rate of the U.S. semiconductor index at three times. Semiconductor stocks, including Nvidia, have not escaped concerns about recession due to China's DeepSeek shock and tariff policies of the Trump administration. The ETF 'NVDL,' which tracks Nvidia's daily increase rate at double, and the covered call ETF 'NVDY' also have most investors in evaluation loss territory.
Among the net purchased stocks, the one with the highest loss rate was plug power, a hydrogen fuel cell corporation. The average evaluation revenue of 7,829 plug power investors was -84.7%. Companies like Ab Robotics and Resolve AI, whose stock prices hover around $1 like plug power, also showed average evaluation loss rates exceeding 60%.
Foreign retail investors who expected the policies of President Trump have also not been smiling. The average evaluation loss rate for ETFs related to MicroStrategy, considered the leader in virtual assets and Bitcoin, was high: ETHU -75.76%, MSTX -69.39%, MSTU -55.48%, CONY -47.31%, BITU -32.33%, etc. Additionally, most investors are experiencing evaluation losses in Vistra Energy, related to President Trump's natural gas policies, and the 'KOLD' ETF.
Additionally, SMCX and PLTU, which track the daily increase rates of Super Micro Computer and Palantir respectively at double, also reported average evaluation loss rates exceeding 30%.
The poor performance of the U.S. New York Stock Exchange has not only impacted leverage products and highly volatile tech stocks, but also high dividend stocks and stock index tracking ETFs, turning their average evaluation revenue negative. Examples include 'SCHD', 'VOO', 'QQQ', and 'SPY'.
Among the domestic investors recording evaluation profits were Oracle, Meta Platforms, and Alphabet. Although the stock prices of these three stocks have fallen about 30% from their previous highs, they have not entered evaluation loss territory because the average purchase price was low for long-term investors. Additionally, ETFs related to gold such as 'GLD', short-term company bonds like 'SPSB', and the parking-type 'SGOV' have also shown average revenues in the positive.
ETFs based on the 'collective intelligence' of foreign retail investors boasted high revenue last year, but have seen greater declines during the downturn that has intensified this year. Kodex American Foreign Retail Investors and ACE U.S. Stock Bestsellers show approximately 30% declines from their peaks. These stocks are ETFs that increase the proportion of U.S. stocks held by domestic investors, but they have underperformed compared to the decline rates of the Nasdaq 100 index (21.6%) and S&P 500 index (17.65%).
While the aggressive investments of foreign retail investors yielded results in a bull market, the weaknesses of an investment style without hedging have been revealed as the market entered a downturn. The key question is whether there will be changes to the tariff policies of the Trump administration, which triggered the sharp decline.
Kim Jae-seung, a researcher at Hyundai Motor Securities, noted, 'For the market to rebound, there must be significant progress in negotiations with the U.S. initiated quickly by Japan or the European Union (EU), which has kept the door open for dialogue.' He added, 'It is necessary to calmly respond to the market while waiting for news of mutual tariff exemptions or the 'Powell Put' (the mechanism by which Jerome Powell, the chair of the U.S. Federal Reserve, defends the downturn).'