'Korea's Fear Index' Surges 19% Amid Volatility, Closes at All-Time High

As the domestic stock market shows a strong rebound today (June 9) following yesterday's sharp decline, the "fear index" has hit an all-time high due to increased volatility.

According to Koscom Check on June 9, the KOSPI 200 Volatility Index (VKOSPI), known as the "Korea's Fear Index," closed at 91.23, up 19.04% from the previous session.

The index opened at 86.55, up 12.95%, and closed at its intraday high.

This level is higher than the previous record high for this year (83.58 on March 5), which was recorded immediately after the outbreak of war with Iran following attacks by the U.S. and Israel. It marks the highest level since April 13, 2009, when the Korea Exchange began officially publishing the index.

Even when looking at VKOSPI data collected before the index was officially published, the closing figure surpassed the level seen on October 29, 2008 (89.30), during the global financial crisis.

The VKOSPI is an index that measures expected future market volatility reflected in option prices. While it typically rises when the KOSPI falls sharply, it can also increase when investors feel anxious and market uncertainty is high, even in a rising market.

This suggests that market participants' outlooks on the future direction of the KOSPI are sharply divided between gains and losses.

In fact, although the Philadelphia Semiconductor Index rose 5.61% in the New York stock market overnight and the KOSPI surged 8.18% today, it is not enough to recover the losses from the past three days.

Concerns that adjustments could resume depending on the U.S. Consumer Price Index (CPI) for May, to be released on the evening of June 10 (KST), and the earnings of U.S. software company Oracle, due on the morning of June 11, are making it difficult to be certain about the market's direction.

Meanwhile, "sidecars" were triggered consecutively in the KOSPI and KOSDAQ markets early in the day as prices rebounded sharply, suspending the validity of program buy orders for five minutes.

A KOSPI sidecar is triggered when the price of KOSPI 200 futures rises by 5% or more from the reference price and sustains that level for one minute. A KOSDAQ sidecar is triggered when the price of KOSDAQ 150 futures rises by 6% or more from the reference price and the KOSDAQ 150 index rises by 3% or more from the previous trading day's closing value, with both conditions sustained for one minute.

The KOSPI closed at 8,096.93, up 8.18% from the previous session.

The KOSDAQ closed at 967.81, up 6.19%.

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.