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Samsung Electronics, LGES, SK hynix were most shorted stocks in Sept.
By Anna J. Park
The total amount of short-selling transactions on the main Korea Composite Stock Price Index (KOSPI) in September increased about 40 percent compared to the previous month, while the country's blue-chip stocks were the most shorted amid the bear market.
According to the Korea Exchange (KRX) on Monday, the average daily transaction amount of short-sold stocks on the benchmark index stood at 490.6 billion won ($340 million) in September, up around 40 percent from the previous month. The average daily short-selling transaction amount on the tech-heavy Kosdaq also rose 8.8 percent to 134.9 billion won during the same period.
Samsung Electronics, LG Energy Solution (LGES) and SK hynix ― the top three stocks on the KOSPI in terms of market capitalization ― were the most shorted stocks in September. A total of 557.5 billion won were bet against Samsung Electronics stocks, while 534.4 billion won and 358.5 billion won were each bet against the stock price increases of LG Energy Solution and SK hynix in the past month.
Reflecting short-sellers' market forecasts, Samsung Electronics' stock price fell by 9.54 percent in September, while LGES' stock price decreased by 11.42 percent and SK hynix's price fell by 11.5 percent.
With the U.S. Federal Reserve taking a series of giant steps by raising the key interest rate by 75 basis points, investor sentiment has been bearish, leading to the surge in short-selling transactions. The KOSPI index fell by 12.81 percent in September, while the Kosdaq declined by 16.65 percent.
Market watchers view that the KOSPI index could fall to as low as 2,000 points by the end of this year, which is down about seven percent from the close of 2,155.49 points last Friday. They also caution against investing in the stocks that are the main targets of such short-selling.
"The aggregate amount of short-selling transactions has increased a lot during the past month of market correction. We particularly advise being extra cautious about investing in stocks that have become the main target of short-selling in the market," Kim Joong-won, an analyst at Hyundai Motor Securities, said.
