Core Viewpoint - The article discusses the increasing interest of South Korean investors in the Chinese stock market, highlighting a shift in investment strategies due to market conditions and the pursuit of higher returns [5][11][22]. Group 1: Investment Trends - As of July 25, 2023, China has become the second-largest overseas stock market for South Korean investors, surpassing Japan and the EU in trading volume [5]. - The total trading volume of the Chinese stock market, including Hong Kong and A-shares, reached approximately $57.64 billion, second only to the U.S. market [6]. - South Korean investors show a preference for Hong Kong stocks over A-shares, focusing on technology and consumer sectors [5][9]. Group 2: Notable Stock Purchases - The top net purchases by South Korean investors include Xiaomi Group-W and BYD Company, with net buy amounts exceeding $1 billion [7][8]. - Other significant stocks include Ningde Times and Alibaba, indicating a strong interest in technology and consumer goods [8][9]. Group 3: Market Dynamics - The trading volume from South Korean investors in the Chinese stock market surged to $782 million in February 2023, marking a 179% month-on-month increase [12]. - In the first quarter of 2025, South Korean investors had a net inflow of 6.54 trillion KRW into Chinese stock funds, with 2.739 trillion KRW in April alone [12][13]. - The average return rate of Chinese stock funds in South Korea reached 43.56% over six months, significantly higher than domestic and U.S. stock funds [13]. Group 4: Broader Investment Context - The shift towards Chinese stocks is partly driven by volatility in the U.S. market, prompting South Korean investors to diversify their portfolios [13][14]. - Despite the growing interest in China, the U.S. market still dominates South Korean offshore trading, accounting for nearly 96% of transactions [14]. - The total assets of overseas investment funds in South Korea reached 134 trillion KRW by the end of 2024, reflecting a 62% year-on-year increase [15]. Group 5: Socioeconomic Factors - The article notes a prevailing negative sentiment in South Korea, with low employment rates and stagnant wages pushing individuals to seek alternative investment opportunities [20][21]. - A Gallup survey indicated that 31% of respondents now view stocks as the most favorable investment, surpassing real estate for the first time since 2006 [20]. - The number of active stock trading accounts in South Korea has risen to 69.3 million, indicating a widespread engagement in stock trading among the population [20].

Core Viewpoint - Korean investors are increasingly turning to the Chinese stock market, driven by a combination of high returns and a desire to diversify their investment portfolios amid domestic economic challenges [6][12][22]. Group 1: Investment Trends - As of July 25, 2023, China has surpassed Japan and the EU to become the second-largest overseas stock market for Korean investors, based on trading volume [6]. - The cumulative trading volume of the Chinese stock market, including Hong Kong and A-shares, reached $57.64 billion, second only to the U.S. market [8]. - Korean investors show a preference for Hong Kong stocks over A-shares, focusing on technology and consumer sectors [9][12]. Group 2: Notable Stocks and Investment Behavior - The top ten net purchases by Korean investors as of July 25, 2025, were all Hong Kong stocks, with Xiaomi and BYD leading with net purchases exceeding $100 million [10][11]. - Korean investors have shown consistent interest in Chinese stocks since early 2025, with significant inflows into Chinese stock funds [15][16]. - The average return of Chinese stock funds in Korea was 43.56% over six months, significantly higher than domestic and U.S. stock funds [18]. Group 3: Economic Context and Investor Sentiment - The shift towards Chinese stocks is partly due to stagnant domestic economic conditions in Korea, including a struggling job market and rising real estate prices [26][27]. - A survey indicated that 31% of respondents view stocks as the most favorable investment method, surpassing real estate for the first time since 2006 [28]. - The average return of the Korean stock market was only 5% over the past decade, compared to 10% for China and 13% for the U.S., leading to a loss of confidence in domestic equities [30]. Group 4: Broader Investment Strategies - Korean investors are diversifying their portfolios to mitigate risks associated with the U.S. market, with a notable shift towards overseas investments [19][21]. - The total assets of overseas investment funds in Korea reached 134 trillion won, reflecting a growing trend towards international markets [21]. - The Korean government is also taking steps to enhance the attractiveness of the domestic stock market, aiming to reverse the "Korean discount" phenomenon [31].