Parents who once taught their children the importance of saving through bank savings and installment deposits now emphasize long-term asset growth by using tools such as exchange-traded fund (ETF) investing. The stock accounts of underage investors, known as "little ants," are showing changes as well.
According to NH Investment & Securities on the 3rd, the balance of domestic and overseas ETFs in underage accounts jumped 5.2 times to 216.4 billion won as of Sept. 16 this year, from 41.6 billion won at the end of 2021. Compared with the balance of individual domestic and overseas stocks, which grew 1.4 times over the same period to 798.0 billion won from 576.8 billion won, the growth is striking. By investment share, ETFs expanded from 6.7% to 21.3% during this period.
The number of underage savings and installment deposit accounts at the five major commercial banks (KB Kookmin, Shinhan, Hana, Woori, NH Nonghyup) fell about 8% over four years (2020–2024), from 5.27 million to 4.84 million. This contrasts with a 40.1% increase in the number of underage customers at NH Investment & Securities over the past four years (173,982 → 243,697).
Underage stock and fund investments generally begin while children are minors and are mostly prepared to cover tuition or funds for economic independence. They are attractive for the potential of long-term investing and compound interest. In addition, gift tax is exempt up to 20 million won over 10 years for children under 19, offering tax-saving benefits.
A look at underage investors' accounts shows active investing in overseas stocks. During this period, holdings of overseas stocks increased by 217.8 billion won (88.6 billion → 306.4 billion won), outpacing the 178.3 billion won (529.7 billion → 708.0 billion won) increase in domestic stock holdings.
However, by share of holdings by category, the share of individual stocks within overseas equities actually fell from 78.6% to 64.1%. Conversely, the ETF share rose from 21.4% to 35.9%.
As many parents open and manage their children's accounts for early gifting, it appears they have increased the share of ETFs, which have lower volatility than individual stocks and allow for risk diversification.
Pension savings products, which are more favorable than general securities accounts in terms of tax benefits, do not allow trading of individual stocks. Office worker Kim Jeong-hyeon, 43, who opened a pension savings account in a child's name who turned 9 this year, said, "On Apr. 4, I opened an account in my child's name and first gifted 20 million won," adding, "I put half each into ETFs tracking the S&P 500 and Nasdaq, and I plan to open a separate account so that the child can trade stocks directly as an allowance around middle school."
The shift of funds from savings and installment deposits to the stock market, especially to overseas ETFs, stems from the long-proven performance of the U.S. market. In terms of long-term returns, the U.S. Standard & Poor's (S&P) 500 and the Nasdaq have outperformed domestic indexes. Over roughly the past five years (Jan. 1, 2021–Sept. 16, 2025), the S&P 500 and the Nasdaq rose 43% and 39%, respectively, while the Kospi index climbed only 16%. The Kosdaq index actually fell 18%.
During this period, four of the top five ETFs by net purchases within underage accounts were U.S. index products. Mirae Asset Global Investments' "TIGER U.S. S&P 500" ETF was the largest at 14.0 billion won (9,930 people). They were followed by ▲Invesco QQQ Trust SRS 1 (7.2 billion won, 3,429 people) ▲Vanguard S&P 500 (7.0 billion won, 2,495 people) ▲KODEX U.S. S&P 500 (5.8 billion won, 3,892 people). In addition, Schwab U.S. Dividend Equity (6.0 billion won, 4,258 people), which invests in high-dividend U.S. stocks, and TIGER U.S. Dividend Dow Jones (2.4 billion won, 2,392 people) ETFs were also net purchased.
Although underage funds are moving en masse from savings and installment deposits into the stock market, it is essential to remember that stocks are risk assets. While ETFs are far more stable than individual stocks, stocks are still stocks.
Lee Eun-taek, an analyst at KB Securities, said, "The U.S. stock market is approaching the 'dot-com bubble,' and the expansion of households' stock allocations and the influx of large investment funds are reinforcing signs of overheating," adding, "In a highly valued phase centered on artificial intelligence (AI) stocks, inflation risk will be a particularly significant threat."