As the KOSPI index recently broke through 7,000 and surged, cash in the market is flowing into stocks. Demand deposits, a form of idle funds waiting to be invested, fell by more than 3 trillion won over the past month, while investor deposits increased by about 20 trillion won in a month, nearing 130 trillion won.
According to the financial sector on the 8th, demand deposits at the five major banks (KB Kookmin, Shinhan, Hana, Woori, NH NongHyup) stood at 696.5524 trillion won at the end of April, down 3.3557 trillion won from the previous month (699.9081 trillion won). This is the first decrease in demand deposits in three months since January this year. Demand deposits are funds that depositors can withdraw at any time if they wish, and are classified as idle funds for investment and other purposes.
Investor deposits climbed from around 110 trillion won early last month to over 130 trillion won early this month. Investor deposits are money that investors have left in securities firm accounts to buy stocks or have not withdrawn after selling stocks. Like demand deposits, they belong to idle funds waiting to be invested.
A financial industry official said, "As the KOSPI topped 7,000, more people are even breaking existing savings and installment savings to invest in stocks. This dynamic pattern is likely to repeat this year depending on stock market conditions."
Some analysts also say that the fear of missing out (FOMO) driven by the steep rise in the KOSPI influenced the movement of funds. The KOSPI index has risen about 80% this year alone, and in this environment, the sentiment of "I must not fall behind" is spurring investors.
Some caution that, given how sharply the stock market has climbed, investors should be prudent about chasing the rally.