Korean investors cut back their holdings of foreign equities last year primarily due to the angst over global uncertainties stemming from the eurozone debt crisis, data showed Thursday.
The value of foreign stocks traded by local investors totaled $2.92 billion in 2011, down 49.2 percent from the $5.75 billion tallied in the previous year, according to the data by the Korea Securities Depository.
The 2011 figure is lower than the $3.3 billion and $3.1 billion tallied in 2008 and 2009, respectively, when the global credit crunch hit the local financial market in the wake of the collapse of Lehman Brothers.
Investors turned away most from buying European stocks, with its total amount of trading plunging 75 percent to $280 million last year from a year earlier.
They reduced nearly two-thirds of the holdings of Japanese equities to $120 million on-year from $420 million, the data showed.
Analysts said investor appetite has been dampened to snap up overseas stocks on fears of lingering concerns over the debt-ridden eurozone, projecting such a risk-averse trend will likely continue this year.
They also cited higher tax and commission rates for foreign stock trading as the reasons for local investors to slash their equities abroad.
The net value of foreign stock funds, meanwhile, shrank 37.5 percent to 23 trillion won ($20.5 billion) as of end-2011, from 36 trillion won in the previous year, according to separate data by financial information provider FnGuide.
(Yonhap News)
