National Pension and Other Funds Net Buy KRW 105 Billion Amid Market Plunge... "Completely Different from Market Expectations"

While the KOSPI has undergone a sharp correction, plunging more than 30% this month, pension funds including the National Pension Service (NPS) have instead been net buyers of domestic stocks.

While the market had projected that the NPS might engage in large-scale profit-taking to adjust its domestic stock allocation, actual management is analyzed to have maintained its long-term investment stance.

According to the Korea Exchange, "pension funds and others" net purchased KRW 105 billion worth of shares in the KOSPI market from the 1st to the 28th of this month.

In particular, they net purchased KRW 113.5 billion on the 28th alone, when the KOSPI plummeted by more than 10%.

The category of "pension funds and others" includes stock transactions by public pensions, mutual-aid associations, and national and local governments, alongside the National Pension Service.

Because the NPS is the country's largest institutional investor and its trading direction heavily impacts the stock market, the possibility had been raised in the market that the NPS might engage in massive selling during the rebalancing process of adjusting its domestic stock proportion.

In reality, however, they maintained a net-buying stance throughout the entire month, showing a movement contrary to market forecasts.

Some in the market interpreted that this may have also considered the point that if the NPS were to engage in massive selling when stock market volatility has intensified due to the recent expansion of single-stock leverage ETFs, the shock to the market could become even greater.

Previously, criticism had been raised mainly by the opposition circles questioning whether the NPS's domestic stock management was mobilized to prop up stock prices.

During a work report on the 16th, President Lee Jae-myung mentioned that there were rumors that the NPS had purchased domestic stocks ahead of the local elections to prop up stock prices, and directly questioned whether it had actually purchased domestic stocks before the election.

National Pension Service Chairman Kim Sung-joo explained that there were absolutely no additional purchases made with the election in mind, and that the increase in the proportion of domestic stocks was due to an increase in the appraised value of held stocks driven by rising stock prices.

Chairman Kim also recently stated on his social media, "Without being swayed day by day by market volatility, as a long-term investor managing the public's retirement assets, I will stick to investment principles based on a long-term horizon and perspective."

Reported by Kim Minjeong | Video by Lee Eui-seon | Graphics by Lee Soo-min | Produced by SBS Digital News
※ Please note: This article was translated by AI and may contain errors.