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South Korean boy investor with 43% gains is new retail trading icon

Economic IndicatorsFeb 09, 2021 05:30AM ET
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2/2 © Reuters. Kwon Joon checks investing information at his room in Jeju 2/2

By Cynthia Kim

SEOUL (Reuters) - Watching the business news first thing is a new routine for 12-year-old South Korean Kwon Joon, as he dreams of becoming the next Warren Buffett after earning stellar returns of 43% from a hobby picked up just last year: buying stocks.

Kwon pestered his mother to open a retail trading account last April with savings of 25 million won ($22,400) as seed money, just as the benchmark KOSPI index began recovering from its biggest dip in a decade.

"I really talked my parents into it, because I believed an expert who was saying (on TV) that this is a once-in-a-decade opportunity," said Kwon, who rode the steepest jump by year-end among MSCI's country indexes..

"My role model is Warren Buffett," he added, in a reference to the U.S. billionaire investor.

"Rather than short-term focused day trading, I want to keep my investment for 10 to 20 years with a long-term perspective, hopefully to maximize my returns."

South Korea's rookie investors like Kwon, who pursues "value investing" in blue chip shares with funds garnered from gifts, trading mini-car toys and running vending machines, have led the blistering rise of retail trade amid the coronavirus pandemic.

More retail investors are teenagers or even younger, making up more than two-thirds of the total value traded in the nation's shares, versus less than 50% in 2019.

The trend has grown as equity markets lure parents disillusioned with the education system and millennials working from home.

"I wonder, in this day and age, whether a college degree would be all that important," said Kwon's mother, Lee Eun-joo, who fuelled his passion by looking to expose him to business rather than tuition, seen as key to getting ahead in academics.

"Because we live in a different world now, it could be better to become an 'only-one' kind of person," added Lee, who feared even a good schooling might not arm her son against dwindling job opportunities.

About 70% of the 214,800 stock brokerage accounts for minors at Kiwoom Securities, South Korea's most retail-friendly brokerage, with a market share of more than a fifth, were set up in January 2020 or after, its data shows.

Kwon, with time on his hands during last year's school closures for the pandemic, drew up a wish list of purchases, which he made during market corrections.

These ranged from South Korea's largest messenger app operator Kakao Corp., to the world's biggest memory chip maker Samsung Electronics (OTC:SSNLF) Co., and Hyundai Motor.

Kwon's success also reflects the employment challenges for young South Koreans, with one in four out of work by January, the worst level on record, despite being among the most highly educated cohort in the OECD club of advanced nations.

Three-quarters go on to college after high school, versus the grouping's 44.5% average, but finding rewarding, creative work is tough. "There aren't enough jobs for college graduates, so many are opting out to diversify their career path early," said vocational researcher Min Sook-weon.

That is something Kwon understands.

"Rather than going to good schools like the Seoul National University, I'd rather become a big investor," he said. "I also hope to do a lot of charity work."

($1=1,115.1600 won)

South Korean boy investor with 43% gains is new retail trading icon
 

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Comments (8)
Anthony Anthony
Anthony Anthony Feb 09, 2021 3:14PM ET
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Little dude in yellow shirt can use some exercise
Victor Ravelo
Victor Ravelo Feb 09, 2021 8:58AM ET
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I'm +30% first two months of the year copy my portfolio in etoro deathxmx
Chris Sundo
Chris Sundo Feb 09, 2021 6:26AM ET
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It's like giving your Porsche car key to a minor (under 18) .. Talk to a hospital surgeon about how these things end. -- Better to emigrate to Germany with that education
Chris Sundo
Chris Sundo Feb 09, 2021 6:11AM ET
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The rising tide lifts all boats. The market takes the stairs up and the elevator down!! You need a good mentor. Go see Warren Buffet soon! Have a personal chat with him. Kwon Joon!, Watch out buddy! Most people have the same experience with a rising market. When the market rockets the other way you better be in cash by then!! -- And work out in your living room. You're at risk of a heart attack under 20
Matt Kay
Matt Kay Feb 09, 2021 6:11AM ET
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Buffet? You must be joking? Old boomer who knows nothing besides buying and holding? His portfolio is 50% apple.
Javi Sempere
Javi Sempere Feb 09, 2021 5:51AM ET
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SP 500 has grown 46.92% since March. The kid is doing well, but he is 3.9% behind
Leandro Rochedo
Leandro Rochedo Feb 09, 2021 5:42AM ET
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well.. anyone who started trading after feb/20 is making money, lots of it.
Playzor Andersson
Playzor Andersson Feb 09, 2021 5:38AM ET
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43% is not noteworthy... Some have become seriously rich from nothing last year by trading.
David David
David9 Feb 09, 2021 5:17AM ET
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In this market with all the printing of money, even a monkey can make money... 12 yr old should stick to playing video games and stay in school...
Gus McCrae
Gus McCrae Feb 09, 2021 5:17AM ET
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agree. right now is not how skillful you are but how much you have or are willing to risk in investments
 
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