South Korean retail investors dump gold as stocks rally

Bars of fine gold from the Korea Gold Exchange Yonhap — Bars of fine gold/ Yonhap

SEOUL, July 22 (AJP) - South Korean retail investors have turned net sellers of gold for the first time in over a year, pivoting toward equities as the country’s main stock index soared to its highest level in nearly four years.

Between July 1 and July 21, individual investors unloaded a net 15.9 billion won, or approximately $11.4 million, worth of gold on the Korea Exchange, with a sharp 11.1 billion won sold in a single day on July 21, according to exchange data.

Proprietary trading firms also joined the sell-off, shedding nearly 11.4 billion won worth of gold over the same period.

The shift ends a 15-month streak of net gold purchases that began in March 2023 and saw retail investors accumulate nearly 1.5 trillion won in the precious metal through June.

Analysts say the reversal reflects growing confidence in the domestic equity market, where the benchmark KOSPI index crossed the 3,200 mark in mid-July — a level last seen in late 2021.

The rally, driven in large part by surging semiconductor stocks and optimism surrounding the new government’s economic agenda, has lured capital away from traditional safe-haven assets.

International gold prices, meanwhile, have remained rangebound around $3,370 per troy ounce after peaking at $3,487.94 in April.

The recent plateau follows a months-long rally fueled by investor anxiety over U.S. trade policy and global economic uncertainty, as well as a weakening dollar that had amplified demand for gold earlier in the year.

While South Korean investors pulled back, their Chinese counterparts were heavy buyers of gold in the first half of 2025, purchasing about 63 tons through exchange-traded funds. However, that demand has since cooled after Beijing launched a crackdown on speculative trading in May.

Kim Dong-young davekim0807@ajupress.com