SEOUL – Watching the business news first is a new routine for 12-year-old South Korean Kwon Joon, who dreams of becoming the next Warren Buffett after gaining superb returns of 43 from a hobby that started just last year Percent: buy shares.
Kwon harassed his mother last April into opening a retail account with savings of 25 million won (S $ 29,800) as seed capital, just as the benchmark KOSPI index began to recover from its biggest decline in a decade.
“I really persuaded my parents to do this because I believed an expert who said (on TV) this was a once in a lifetime opportunity,” said Kwon, who made the steepest jump among MSCI country indices at year-end.
“My role model is Warren Buffett,” he added in a reference to the US billionaire.
“Instead of focusing on short-term day trading, I want to hold my investment for 10 to 20 years with a long-term perspective, hopefully to maximize my return.”
South Korea’s rookie investors like Kwon, who value invested in blue-chip stocks with money sourced from gifts, trading mini-car toys, and running vending machines, have retailed in soared.
More retail investors are teenagers or younger, accounting for more than two-thirds of the total value traded in the country’s stocks, up from less than 50 percent in 2019.
The trend has grown as the stock markets disillusion parents with the education system and home-working millennials.
“I wonder these days if a college degree would be that important,” said Kwon’s mother, Lee Eun-joo, who fueled his passion by exposing him to business rather than teaching, which was seen as the key to earning science advance .
“Because we are now living in a different world, it might be better to become a ‘single’ person,” added Lee, who feared that even a good schooling would not prepare her son for dwindling job opportunities.
Around 70 percent of the 214,800 underage stockbrokerage deals at Kiwoom Securities, South Korea’s most retail-friendly brokerage with a market share of more than a fifth, were established in January 2020 or later.
Kwon, who had time during school closings for the pandemic last year, created a wish list of purchases made during the market corrections.
These ranged from South Korea’s largest messenger app operator Kakao Corp. via the world’s largest memory chip manufacturer Samsung Electronics Co. to Hyundai Motor.
Kwon’s success also reflects the employment challenges facing young South Koreans, despite being among the most educated cohorts in the OECD Advanced Nations Club.
Wednesday’s data showed that the unemployment rate for young Koreans between the ages of 15 and 29 rose to a new record of 27.2 percent in January as jobs disappeared at the fastest pace in two decades amid coronavirus containment conditions.
Three-fourths go to college after high school, compared to the group average of 44.5 percent, but finding rewarding, creative work is difficult.
“There aren’t enough jobs for college graduates, so many choose to diversify their careers early on,” said career researcher Min Sook-weon.
Kwon understands that.
“Instead of going to good schools like Seoul National University, I’d rather be a big investor,” he said. “I also hope to do a lot of charity work.”
