South Korea's stock market boom has sparked a surge in novice investors, with everyday citizens like Kim Ha-young, a 30-something office worker, taking the plunge into the market for the first time. This trend is a remarkable turnaround for a market once considered a laggard compared to its global peers, plagued by the "Korea discount" and weak corporate governance. The recent rally, driven by a global shortage of memory chips and the AI-driven demand for these chips, has seen South Korea's benchmark Kospi nearly double in value, making it the best-performing major index worldwide. This boom has attracted a growing number of South Koreans to the stock market, with the number of active trading accounts rising to 105.22 million as of May, up from 6 million in 2019. However, the market's volatility raises concerns about its sustainability, with a recent 9% plunge in the Kospi triggering a circuit breaker. Despite this, the market's rise has been fueled by record-breaking profits for Samsung Electronics and SK Hynix, the country's largest memory chip manufacturers. This has led to a surge in interest from young investors like Kim Do-hyun, who see the market as an opportunity to grow their wealth. The South Korean government, under President Lee Jae-myung, has pledged to reform the market and shed the country's reputation as an investing backwater. Lee's administration has introduced reforms to protect minority shareholders and encourage investment, aiming to steer capital towards "good companies with high productivity" as the country faces long-term growth challenges due to an aging labor force. The market's boom has also highlighted the need to loosen Koreans' attachment to property, a traditional store of wealth, which has contributed to one of the least affordable property markets globally. As the market continues to evolve, investors like Kim Ha-young are learning to manage their expectations and invest for the long term, despite the risks of market volatility.
