NH Investment & Securities projected on the 26th that the launch of the alternative trading system (ATS) NextTrade and the full resumption of short selling would increase transaction volumes and contribute to securities firms' brokerage revenue. It identified Kiwoom Securities and Mirae Asset Securities as preferred stocks.
Yoon Yoo-dong, a researcher at NH Investment & Securities, assessed that NextTrade will trigger structural growth in the transaction market. He noted, "Currently, the average daily transaction volume of NextTrade is around 2 trillion won, which is less than the Korea Exchange (about 20 trillion won), but as the number of tradeable stocks increases to 800 and if the order processing system is differentiated, changes in securities firms' market share could occur."
Researcher Yoon viewed that the potential for foreign investors to return to the Korean stock market due to the resumption of short selling is also a positive development for securities firms. Short selling transactions are scheduled to fully resume starting the 31st. Researcher Yoon mentioned, "Looking at past cases, the re-entry of foreigners into the market after the resumption of short selling has led to an increase in the proportion of foreign trading," adding, "It is expected to similarly increase transaction volumes this time as well." He noted, "The short selling balance has already partially recovered."
The craze for overseas stock investment is also continuing. Although the average daily transaction volume has decreased from 8 trillion won at the end of last year to around 6 trillion won, as the U.S. stock market, the largest investment destination, is undergoing corrections, the market could rebound and increase again at any time, according to Researcher Yoon.
Researcher Yoon stated, "There had been intense competition among securities firms to reduce commissions to expand their share in overseas stock trading, but recently the trend has shifted toward strengthening services," adding, "For the time being, Kiwoom Securities, Toss Securities, Samsung Securities, and Mirae Asset Securities are expected to maintain a leading position in overseas stock trading shares."
Researcher Yoon recommended Kiwoom Securities and Mirae Asset Securities as the most noteworthy securities firms at this time. He set target prices at 180,000 won for Kiwoom Securities and 13,000 won for Mirae Asset Securities, which are 38% and 31% higher than their current stock prices, respectively.
Researcher Yoon said, "Kiwoom Securities holds the top spot in both domestic and overseas stock trading shares," adding, "In particular, its market share in NextTrade is 33%, which shows a significant gap from the second place."
He continued, "Mirae Asset Securities is ranked second in domestic stock trading share and is among the top in overseas stock trading," noting, "It has been strengthening its brokerage business for not only domestic but also overseas corporations, indicating thorough management of retail and institutional clients."