South Korea retail investor deposits fall below 100 trillion won

South Korean investors’ deposits fell below 100 trillion won ($72.4 billion) again, while margin debt, a measure of leveraged investing, climbed back above 33 trillion won.

Investor deposits stood at 98.92 trillion won as of Wednesday, down 3.62 trillion won from the previous session, according to the Korea Financial Investment Association.

It was the first time deposits had fallen below 100 trillion won in two weeks, since Aug. 12, when they stood at 99.98 trillion won. The deposits had risen as high as 106.58 trillion won on Aug. 19 before declining again.

Investor deposits generally fall when individuals use cash to buy stocks or withdraw funds. On Aug. 26, retail investors were net sellers of stocks worth 2.25 trillion won on the Kospi, while deposits fell by a further 3.62 trillion won.

Margin debt stood at 33.1 trillion won on the same day, up 254 billion won from the previous session and moving back above 33 trillion won for the first time in about a month. The balance was last higher at 33.19 trillion won on July 28.

Margin debt has risen for seven straight trading sessions since Aug. 18, after falling to 27.4 trillion won on Aug. 4.

The decline in investor deposits alongside rising margin debt suggests retail investors are increasing their stock investments with borrowed money as their available cash shrinks.

The trend comes as the Kospi has struggled to establish a foothold above 7,000 points and has moved sideways within a range, raising uncertainty over further gains.

Short-term credit transactions also rose to 1.15 trillion won, up 146.9 billion won from the previous session. Forced selling triggered by unpaid credit, known as margin selling, stood at 12.7 billion won, equivalent to 1.3 percent of outstanding short-term credit.