South Korean Investments in U.S. Stocks Hit Record $180 Billion Amid Renewed Market Optimism

Seoul—South Korean investors have taken their appetite for U.S. stocks to a historic high, with holdings exceeding $180 billion. This surge comes as concerns over trade tariffs ease and optimism for artificial intelligence (AI) and cryptocurrency regulations sparks a renewed buying frenzy.

Data from the Korea Securities Depository as of October 16 reveals that South Korean investors now hold $131.7 billion (approximately 183.45 trillion won) in U.S. stocks, marking a 20.8% leap from $109 billion earlier this year. The biggest contributors to these sizable holdings include technology and AI-centric companies, solidifying the sector's dominance in Korean portfolios.

Leading the pack in investments are Tesla with $21.29 billion and Nvidia at $14.66 billion. AI-related stocks such as Palantir ($5.19 billion), Apple ($4.22 billion), and Microsoft ($3.44 billion) make up the remainder of the top five, emphasizing the growing interest in tech-driven growth sectors.

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Eased Trade Tensions and AI Advancements Spark U.S. Stock Boom

During the pandemic, U.S. stocks became the standout strategy for South Korean investors. However, earlier this year, lingering trade concerns tied to the disruptive tariff strategies of former U.S. President Donald Trump had temporarily dampened enthusiasm. This period saw diversification efforts under the so-called "Sell America" trend as investors looked for safer havens.

But a shift in sentiment has emerged. With markets adapting to trade volatility and benefitting from strong economic and corporate fundamentals, the allure of U.S. equities has returned stronger than ever. Key drivers for this resurgence include better-than-expected consumer data, increasing investments in AI infrastructure, and solid corporate earnings.

Adding to this renewed confidence is the push by Trump-era policymakers and the Republican Party to legislate on stablecoin regulation, which has invigorated optimism around the burgeoning cryptocurrency industry. Tight regulations paired with clear frameworks are seen as a catalyst for institutional adoption within the digital asset ecosystem.

"Both AI and cryptocurrency sectors hold significant promise in driving future growth," commented Seo Young-jae, a researcher at Daishin Securities. "Although stocks like Nvidia have already delivered impressive returns, their growth, underpinned by earnings potential, remains resilient."

Jung Yong-taek, Chief Economist at IBK Investment & Securities, highlighted the interplay of tariffs and investor sentiment: "Tariff policies generally favor U.S. firms over non-U.S. companies. Coupled with growing expectations for a U.S. interest rate cut, it’s understandable why South Korean investors are showing a reinvigorated appetite for U.S. equities."

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South Korean Investors Ramp Up U.S. Stock Purchases

In the week spanning October 11–17, South Korean investors net-purchased $340 million (approximately 475.7 billion won) worth of U.S. stocks. The most actively traded shares included Coinbase, a cryptocurrency exchange ($68 million); Nvidia, a leader in AI chips ($58 million); IonQ, a quantum computing firm ($52 million); and Circle, a stablecoin issuer ($41 million).

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Domestic Markets See Continued Investment Boom

On home soil, South Korean stock markets are also benefiting from the bullish climate. Leverage-driven investments, colloquially known as "bit-too" (borrowed money-based investments), have been steadily climbing. Credit-based trading totaled 21.59 trillion won as of October 17, up from 21.27 trillion won on October 11—a sign of growing market confidence.

Investor deposits allocated for trading reached 66.63 trillion won on October 17. Simultaneously, cash reserves in asset management accounts (CMA) saw a rapid decline, dropping from 89.6 trillion won to 86.15 trillion won within a week. In contrast, money market funds (MMF), considered another form of readily available capital, saw an uptick of 7.5 trillion won, reaching 231.37 trillion won over the same period.

The growth in idle funds further reflects buoyant investor sentiment across both retail and institutional markets. This sustained liquidity is fostering upward momentum both in domestic equities and overseas holdings.

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With a steady increase in tech-driven U.S. market investments and an optimistic domestic trading environment, South Koreans are actively leveraging their capital to seize opportunities in booming sectors like AI and crypto. As liquidity continues to drive markets, the long-term resilience of these investments will depend on the convergence of innovation, regulation, and economic fundamentals.