With the launch of the new government emphasizing revitalization of the stock market, a 'honeymoon rally' is continuing in the stock market, and it has been found that the amount of short-term idle funds that can flow into the stock market at any time, such as investor deposits, money market funds, and asset management accounts (CMA), has reached an all-time high of 375 trillion won.
According to the Korea Financial Investment Association on the 8th, the total amount of investor deposits, which is the sum of the balances kept in securities accounts, has exceeded 60 trillion won on the 2nd and 4th of the month respectively, excluding balances of derivatives transactions. It has been over three years since investor deposits surpassed 60 trillion won, which was last seen in May 2022.
Investor deposits, which represent the funds that investors leave in their securities accounts to buy stocks or the money remaining after selling stocks, are considered a key indicator of the enthusiasm for stock investment. It is interpreted that the waiting funds to buy stocks have increased as the newly launched government of Lee Jae-myung has announced plans for a large supplementary budget.
The balance of money market funds (MMF), which are products for temporarily holding excess funds, is at a level of 227 trillion won, and the balance of comprehensive asset management accounts (CMA) is 88 trillion won.
The accumulation of idle funds in the market is related to the rapid rise in the stock market. The KOSPI index surpassed the 2810 level on the 5th, marking its highest point in 10 months. Particularly, the index surged as foreign investors aggressively purchased stocks.
The trend of 'debt investment'—borrowing to invest in stocks—is also increasing. According to the Korea Financial Investment Association, the credit transaction loan balance was 18.5144 trillion won on the 4th, an increase of 240.5 billion won compared to the end of last month (18.2739 trillion won). The credit transaction loan balance refers to the amount borrowed by investors from securities firms for stock investment that has not been repaid, and it tends to increase as expectations for stock price rises grow.