The Wall Street Journal (WSJ) on the 24th (local time) described the Korean stock market as "the world's craziest stock market."
In a story titled "The world's craziest stock market has become a ride of terror," WSJ said, "Korea, which brought Squid Game and K-pop, is now a market showing volatility not seen for years in major countries' stock markets." The KOSPI index more than tripled over the past year, then fell about 40% during the six weeks of June–July. As of the 25th, it has rebounded about 20% from the low, but swings continue. WSJ said investors call this kind of market "Rollerkospi."
According to WSJ, the AI-focused hedge fund Situational Awareness held a large position in SK hynix(000660) shares listed in Korea and lost 67% in July alone. The fund sold most of its listed shares to repay loans.
WSJ went on to note that losses were concentrated among individual investors. Introducing these retail investors as "ants," WSJ explained they are "weak individually but powerful when united." Citing a 25-year-old investor, WSJ said the investor started with $14,000 (about 19 million won) from deposits and virtual-asset revenue, but lost it all after putting the money into SK hynix and leveraged ETFs.
WSJ also recalled that President Lee Jae-myung introduced himself as an ant during last year's presidential campaign and pledged KOSPI 5,000 by 2030. As the KOSPI index plunged over the past two months, the president's approval rating fell to 43.3%, the lowest since taking office. Presidential Chief of Staff for Policy Kim Yong-beom was accused by an opposition lawmaker of pressuring for approval of a single-stock leveraged product, but denies the allegation. The presidential office told WSJ it "has made all-out efforts to manage market volatility, including new trading rules."
Jeong Eui-jeong, head of the Korea Stock Investors Association, said in a WSJ interview, "The volatility is too extreme. This isn't sound investing; it's a gambling table and a casino." WSJ added that at a recent National Assembly forum in Seoul, Jeong proposed a moment of silence for individual investors and said, "To return to a normal investing environment, the government cannot sit on its hands. Major surgery is needed."