"Squid Game" moves to Wall Street! Korean retail investors bet on U.S. meme stocks, with overseas holdings surging to $170 billion

Korean retail investors are bringing their "Squid Game"-style aggressive trading strategies to Wall Street.

According to data from the Korea Securities Depository, the scale of U.S. stocks held by Korean investors reached a record $170 billion at the end of October, nearly doubling since the beginning of the year. Their entry is reshaping the crazy trajectory of meme stocks in the U.S.

The Korean stock market has long been known for its active retail investors—who account for more than half of the daily trading volume, willing to leverage and chase hot trends, resulting in high market volatility. Now, this "speculative gene" is being exported across the ocean.

Seiwoon Hwang, a senior researcher at the Korea Capital Market Institute, pointed out: "Korean retail investors are reinforcing the meme stock phenomenon in the U.S. stock market." This means their trading style is overlapping with the speculative forces in the U.S., further intensifying the already emotional meme stock "circle."

Crazy Buying of Meme Stocks! Korean Retail Investors Become a New Engine of Volatility in U.S. Stocks

Korean retail investors' performance in the U.S. stock market this year has been particularly noteworthy.

According to data from the Korea Securities Depository, Korean investors hold about $4.4 billion in shares of the U.S. quantum computing company IonQ, accounting for nearly one-fifth of the company's total market value, making it the fifth largest U.S. stock holding for Korean retail investors. IonQ's stock price soared 370% from March to October.

Meanwhile, they net bought $239 million in shares of plant-based meat company Beyond Meat in October this year—this meme stock experienced a rollercoaster ride of sharp rises and falls during the month.

As Jongmin Shim, a CLSA Korean stock strategist, said: "Korean retail investors are really crazy; their risk appetite is much higher than that of investors in other countries."

Owen Lamont, an investment manager at Acadian Asset Management, even warned: "The U.S. stock market could become like the Korean stock market."

In a research article titled "The Squid Game Stock Market," he compared the high-risk gambling behavior of Korean investors to the hit Netflix series Squid Game—a metaphor for high-pressure competition and extreme stakes.

Lamont believes that this influx of funds is distorting the valuation system, further amplifying the scale and volatility of the "speculative sector" in U.S. stocks.

Behind the Overseas Enthusiasm: Wealth Anxiety and "Dopamine Trading"

The Korean stock market has performed well this year, driven by AI and governance reforms, making it one of the best-performing major markets globally. However, many retail investors still choose to "go overseas," and the reasons are not complicated The South Korean Kospi index has risen by about 70% this year, but the S&P 500 index, when calculated in Korean won, has increased by over 300% during the same period. This significant gap has driven investors to turn to overseas markets.

At the same time, Shin Jong-min pointed out that high housing prices and wealth inequality are prompting more ordinary Koreans to seek a "comeback" in financial assets. "Many people are forced to look for opportunities in the stock market because they cannot afford to buy a house."

It is worth noting that the Korean won has depreciated by nearly 5% in the past three months. Analysts believe that the continuous buying of U.S. stocks by Korean investors is one of the important factors leading to capital outflows and pressure on the exchange rate.

In addition, the ability of Korean retail investors to participate in U.S. stock trading so conveniently is also thanks to the advanced mobile trading systems provided by local brokerages. One investor described, "Buying and selling U.S. stocks in the system is very easy. Dopamine keeps me awake late at night, and I don't even need to exchange currency myself; the system does it automatically."