Category: Money tips Release Date: 2007-04-27
Successful bargain-hunting in South Korea
South Korea is also one of the countries to take QFII system, QFII system, implemented in South Korea more than a decade's time.
As a result of gradual opening up to foreign investment in the Korean market from the point and face, the last full participation. Since 1992, foreign investors in South Korea to maintain net capital inflow of the past ten years. As of the end of 2001, the market value of 936,982 billion won in foreign ownership, accounting for South Korea's total stock market value of 36.6%. Since opening up, foreign investors held a substantial increase in the proportion of South Korea's market influence quite remarkable. With the growth of South Korea's domestic securities market, Samsung Electronics and other semiconductor stocks shares and blue chip stocks as foreign investors are flocking to hot spots.
In addition, from the point of view of turnover, foreign institutions, the South Korean market turnover is much lower than the overall turnover shows that foreign investors generally pay more attention to long-term investment, to a certain extent, played a lower market volatility, stability, the role of the market .
The South Korean government officially implemented in 1992, the policy QFII. According to statistics, when foreign investment funds into the South Korean stock market, a total of 1.5 trillion won, mainly invest in large capitalization blue chips, KOSP index rose nearly 40% of the year. While the investment is small, but from the very beginning of foreign capital to enter the Korean market on lucrative.
After the South Korean market since the beginning in November 1994 had four years of adjustment, during which the Korean government raised a total of eight times the amount of QFII, until May 1998 after the abolition of restrictions on foreign ownership, foreign investment in June led the launch of the continuous more than a year of big move, KOSP index rose as high as 125.5%.
As Korea's economic recovery, which caused many hypothetically admission benefited greatly from the multilateral institutions, the internationally renowned financial investors George Soros and the investment behavior criticized by outsiders like the easy road all the time of the Arab prince Awalide low-income City of profiteers. In early 1998, Soros bought a big securities company in Seoul, after the company's shares soaring, the rate is expected to reach more than 100 times. Ewalide, then in March 1998 to 150 million U.S. dollars when you buy the modern and the Daewoo Group's stock, along with the rapid growth of corporate earnings, benefits are quite amazing.
With the increased level of market opening, foreign institutional investors to the growing interest in the Korean stock market, the number already accounts for all of South Korea's stock market more than 60% of foreign investors, and that proportion continues to increase. All foreign investors of less than 0.5% of the number of investors to hold the South Korean market more than 1 / 3 of its market value. Note in the Korean market to foreign investors, especially institutional investors, the strength was significant, enough to the evolution of the market of the stock market impact. South Korea's stock market opening attracted a large number of international capital, for the national and regional economic development a large number of investment and financing opportunities and rapid increase in capital inflows.
In addition, the funds in developed countries an absolute dominant position, as at the end of 2001, the United States and British investors, the market value of the total foreign shareholding 68.1%, with U.S. investors is more than the market value of all foreign holdings more than half. Market investors from developed countries while the South Korean market has brought a more mature investment philosophy.
To earn excess profits because
Several Asian countries, the former situation, the structure of foreign capital embodied in the Anglo-American and other developed countries and regions, a higher proportion of funds, these investors have the experience of mature markets guided the concept of value investing into emerging markets in Asia, and in the economic growth was found investment opportunities, make a profit.
When foreign investors enter the local market, it should be the development of the overall macroeconomic situation, the status quo of the domestic capital market, including the circulation of the size and liquidity, as well as the regulatory system and the corresponding set of qualified foreign institutional investors a variety of institutional arrangements, there is a basic research and judge.
It is through the international capital market valuation levels and the international market compared to the situation prevailing economic fundamentals, industry degree of development of the industry fundamentals of the economy, to explore investment opportunities in the local market. At the same time, from an investor's point of view, the situation in the international capital from the global observation, look at investment opportunities in the market will be more objective comparison with other countries for the valuation, the judge will be more accurate.
QFII take full advantage of the trend of globalization, open emerging markets and developing countries, capital markets, opening up a larger space of flows of capital and ultimately to new business opportunities and create new profits. It is also frequent in Asia, international capital markets to seize the investment opportunities to earn excess profits of the underlying causes.
In addition, the position of the foreign qualified institutional investors, the most concern is whether the growth of listed companies, whether to support the performance of listed companies stock prices. So when a foreign qualified institutional investors to enter, they will be very focus on listed companies, micro-level, comprehensive analysis, such as listed companies, information disclosure, accounting and auditing rules, a listed company governance and ownership structure, management, operating conditions and so on. Foreign institutional investors may have different risk preferences, different investment styles, different investment strategies, these ideas may be from the legal, regulatory and market rules, the inevitable challenges of the local regulatory system.
In a sense, international capital to realize their interests, the objective to promote the development of China's securities market. Their participation will change the structure of stock market investors affect stock market investment strategy and investment philosophy of the changes in the securities market is conducive to the gradual with international practice.
China, as countries with economies in transition, the economy has maintained sustained and stable state of high growth, China's attractiveness to international capital is gradually increased at the same time, with the deepening reform of state-owned enterprises, the governance structure of listed companies has been significant improvement in the interests of small shareholders, the more for more attention. Securities market after years of development, a large number of large-scale, performance is good, the status of the industry-leading large-scale blue-chip companies being formed.
With foreign investment in mainland China market, the degree of concern increases, a number of international pension funds and insurance funds and agencies have also begun to apply for QFII amount. The difference is that with the dealer, such capital investment cycle longer, pay more attention to the fundamentals of the enterprise value of long-term investment. These funds intend to enter show that international funding for the long-term confidence in the Mainland China market, not only to provide an endless domestic stock funds, while more conducive to the introduction of international advanced investment concepts, to speed up the process of the internationalization of China's securities market.
(The author worked in the investment JP Morgan Fleming Fund Management Company)
