The most heavily bought stocks by retail investors during the first month after the Korea Exchange (KRX) extended trading hours to 8 p.m. were Samsung Electronics preferred shares (005935) and Samsung Electronics (005930) common shares. Retail investors who piled into Samsung Electronics dumped SK hynix (000660) more than any other stock, while foreign investors did the opposite, buying more than 100 billion won of SK hynix while selling Samsung Electronics — a divergence in supply and demand between the two groups.
According to the Korea Exchange and Koscom on the 12th, retail investors' top purchase on the exchange's after-hours market over the 16 trading days from Sept. 14, when the session made its debut, through Oct. 8 was Samsung Electronics preferred shares, at 72.3 billion won. Over the same period, they also net bought 67.53 billion won of Samsung Electronics common shares, concentrating about 140 billion won in the two issues alone. Hanwha Aerospace (4.47 billion won), Isu Petasys (3.59 billion won) and DB HiTek (3.53 billion won) followed among retail investors' largest net purchases.
By contrast, the stock retail investors sold most was SK hynix, with net selling reaching 92.14 billion won. Samsung Electro-Mechanics (minus 31.53 billion won), Hyundai Mobis (minus 12.83 billion won), Doosan Enerbility (minus 10.55 billion won) and KEPCO Engineering & Construction (minus 8.01 billion won) also saw net selling.
Foreign investors moved in the opposite direction. They net bought 101.54 billion won of SK hynix on the exchange's after-hours market and made Samsung Electro-Mechanics their second-largest purchase at 33.01 billion won. They unloaded large amounts of Samsung Electronics preferred shares (minus 83.11 billion won) and Samsung Electronics common shares (minus 50.49 billion won). That contrasts with the regular session over the same period, where both retail and foreign investors ranked Samsung Electronics and SK hynix as their top two net sales. Institutions, meanwhile, net bought 13.15 billion won of Doosan Enerbility and net sold 15.71 billion won of Samsung Electronics.
Average daily turnover on the exchange's after-hours market was 1.2645 trillion won, about 4.78% of the regular session. That is roughly 74% of the 1.7008 trillion won in average daily turnover on the after-hours market run by Nextrade (NXT), the alternative trading system, leaving the Korea Exchange behind its rival in trading value. The picture differed by market. For KOSPI-listed stocks, average daily turnover at the alternative venue (1.5129 trillion won) far outpaced the exchange (771.2 billion won), but for KOSDAQ stocks the exchange (493.3 billion won) was more than 2.5 times larger than the alternative venue (187.9 billion won). The gap is attributed to NXT's after-hours market being centered on blue chips, while the Korea Exchange allows trading in effectively all listed stocks, including those on the KOSDAQ.
Retail investors drove the market. They accounted for 89.4% of total turnover on the exchange's after-hours market, compared with just 7.9% for foreign investors and 1.6% for institutions. Analysts say the session has broadened the investor base by absorbing demand from office workers trading after hours.
The concern is volatility caused by thin order books. With few quotes on the board, prices swing on a handful of orders, and 1,112 volatility interruption (VI) triggers were recorded on the opening day alone. The figure fell to 426 on the 8th, gradually stabilizing, but volatility remains high. The Korea Exchange is running a nine-member special surveillance task force for the after-hours market through the end of the year to block unfair trading.
