Retail Investors Pour 14.6 Trillion Won a Night Into Kospi 200 Futures

Kospi 200 futures night trading keeps climbing

Daily average reaches 14.6133 trillion won, nearly tripling in four months

As South Korea’s stock market heats up, investors are becoming more active after the regular trading session ends. Night trading in Kospi 200 futures has surged this year as demand grows for ways to react to overseas developments while local markets are closed. Rising volatility tied to the Middle East war and the Kospi’s sharp rally appear to have fueled the increase.

According to the Korea Exchange, turnover in Kospi 200 futures night trading has been on the rise. From May 1 to May 7, average daily turnover reached 14.6133 trillion won, counting both buy and sell transactions.

The increase is stark compared with late last year. Average daily night trading turnover was 4.9106 trillion won in December, then jumped to 8.035 trillion won in January and 11.8099 trillion won in February. It rose to 13.6508 trillion won in March.

Turnover slipped to 10.8524 trillion won in April, but rebounded above 14 trillion won this month. That puts trading volume at nearly three times its level of about four months ago.

Kospi 200 futures night trading runs for 12 hours on weekdays, from 6 p.m. to 6 a.m. the next day. The market gives investors a way to respond in advance to moves in overseas equities, commodity prices and geopolitical events even after the regular session closes.

The recent increase in trading has been driven in part by greater market volatility. The war involving the US, Israel and Iran broke out in late February, weighing on equities and increasing the need for investors to manage positions during overnight hours.

The rally in South Korea’s stock market has also boosted trading. The Kospi has climbed sharply this month, breaking above 7,000 for the first time, prompting more investors to position for either further gains or a pullback.

The expansion in night trading could continue for now. Geopolitical risk in the Middle East, which has had a major impact on South Korean equities since March, remains in place. The possibility of rate increases or pauses by major central banks, including the Federal Reserve, is also adding to market uncertainty.

This week, investors are awaiting April consumer price index data that may offer clues on how the Iran war has affected US consumers. Walmart is also due to report first-quarter earnings. A higher-than-expected US inflation reading could revive inflation concerns and ripple through South Korean stocks.

Kim Dae-young, Hankyung.com reporter, kdy@hankyung.com