The unprecedented volatility that hit the domestic stock market last July is sharply shrinking individual investors' appetite. Amid a market where plunges and surges repeated within a month, even Korean retail investors, famous for their aggressive investing style, appear to be turning their backs. Foreign media interpreted this as a signal not of a simple correction but of a 'collapse of trust', assessing that a recovery in investor sentiment may lag behind an index rebound.
"Not a market but a casino"…signs of retail investors leaving
On the 2nd (local time) Bloomberg, in an article titled 'Crushed by Kospi Rout, Angry Koreans Rip Lee and Vow Not to Buy', focused on the rapid deterioration in the sentiment of Korean individual investors.
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Policy response criticized as coming too late…political risk spreads
The government's response has also become a focus of controversy. Only in mid-July did the financial authorities halt new listings of single-stock leverage ETFs and tighten regulation by raising the basic deposit from 10 million won to 30 million won. Among individual investors, however, criticism spread that it was "closing the barn door after the horse has bolted". More than 35,000 people took part in a national petition, and political circles also raised the question of policy responsibility.
Bloomberg assessed that this affair "touches the core of President Lee's political brand" and that it "is becoming a test of President Lee's 'KOSPI 5000' policy and his capital market reform stance". In other words, policies presented as enhancing shareholder value and advancing the market have instead run into criticism of a 'speculative market'.
Bloomberg predicted that, although the AI boom itself continues and the KOSPI is still recording a high return among the world's major markets this year, restoring individual investors' trust once it has collapsed could take far longer than a share price rebound. Jung Eui-jung, head of the Korea Stockholders Alliance, told Bloomberg that "individual investors are furious with the government" and that "anger and criticism have reached their peak".
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>>Additional
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https://damoang.net/free/6891881#c_6891936
▶ Original source: https://news.nate.com/view/20260803n07045
