Korean Retail Investors Return to Hong Kong Stocks Amid Technology Sector Surge
Korean retail investors, referred to as Jung-hak Gaemi, are making a comeback in the Hong Kong stock market after a five-month hiatus, driven by a strong performance in major technology stocks such as Tencent and Alibaba in the second half of the year.
According to the Korea Securities Depository, domestic investors have net purchased a total of $18.04 million worth of Hong Kong stocks from the beginning of this month until the 22nd. Following a four-month streak of net buying that began in February, these investors switched to net selling in June. They continued to offload Hong Kong stocks for four consecutive months until last month. Despite this selling trend, stock prices for companies like SMIC (up 96.18%), Alibaba (up 58.04%), and Tencent (up 33.08%) experienced significant increases, fueled by the resumption of interest rate cuts in the U.S. and growing expectations surrounding artificial intelligence (AI) advancements. As a result, many Jung-hak Gaemi investors missed out on valuable investment opportunities.
The balance of investments in the Hong Kong stock market has recently surged. The balance held by Jung-hak Gaemi reached $2.88947 billion last month, marking the highest level since June 2022 ($2.99643 billion) in over three years. This represents a remarkable 57.74% increase compared to the end of last year ($1.83185 billion). The increase in investment balance, despite consistent selling of stocks, is attributed to substantial capital gains from previously held investments.
The stock that has seen the most significant increase in investment balance this year is Xiaomi, which has grown by $183.33 million. Xiaomis stock price has jumped 36.3% this year alone. The investment balances for Alibaba and CATL also rose by $135.12 million and $127.33 million, respectively. Alibaba is capturing attention due to the public activities of its founder, Jack Ma, and expectations surrounding its AI and cloud business, while CATL is benefiting from the Chinese governments policies promoting energy storage systems (ESS).
The Hong Kong Hang Seng Index has soared over 30% this year, outperforming the S&P 500 Index (14%) and the Nikkei 225 Index (24%). The increasing number of mainland Chinese companies listing in Hong Kong is further enhancing the global appeal of the market.
According to the Korea Securities Depository, domestic investors have net purchased a total of $18.04 million worth of Hong Kong stocks from the beginning of this month until the 22nd. Following a four-month streak of net buying that began in February, these investors switched to net selling in June. They continued to offload Hong Kong stocks for four consecutive months until last month. Despite this selling trend, stock prices for companies like SMIC (up 96.18%), Alibaba (up 58.04%), and Tencent (up 33.08%) experienced significant increases, fueled by the resumption of interest rate cuts in the U.S. and growing expectations surrounding artificial intelligence (AI) advancements. As a result, many Jung-hak Gaemi investors missed out on valuable investment opportunities.
The balance of investments in the Hong Kong stock market has recently surged. The balance held by Jung-hak Gaemi reached $2.88947 billion last month, marking the highest level since June 2022 ($2.99643 billion) in over three years. This represents a remarkable 57.74% increase compared to the end of last year ($1.83185 billion). The increase in investment balance, despite consistent selling of stocks, is attributed to substantial capital gains from previously held investments.
The stock that has seen the most significant increase in investment balance this year is Xiaomi, which has grown by $183.33 million. Xiaomis stock price has jumped 36.3% this year alone. The investment balances for Alibaba and CATL also rose by $135.12 million and $127.33 million, respectively. Alibaba is capturing attention due to the public activities of its founder, Jack Ma, and expectations surrounding its AI and cloud business, while CATL is benefiting from the Chinese governments policies promoting energy storage systems (ESS).
The Hong Kong Hang Seng Index has soared over 30% this year, outperforming the S&P 500 Index (14%) and the Nikkei 225 Index (24%). The increasing number of mainland Chinese companies listing in Hong Kong is further enhancing the global appeal of the market.
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