South Korea’s rookie investors lose small fortunes amid AI stocks frenzy

Seoul, South Korea – As South Korea’s stock market was surging on the back of AI-driven chip demand early this year, Eun-bi withdrew most of her savings and invested them in shares.

Eun-bi, a civil servant in her thirties, bought several of the market’s star performers, chief among them memory chipmaker SK Hynix, and a United States-listed fund that tracks the semiconductor industry, hoping to raise funds for her wedding in April next year.

But when South Korea’s benchmark KOSPI index plunged nearly 40 percent from its June peak, Eun-bi’s portfolio lost tens of thousands of dollars, throwing her wedding plans into doubt.

“Now I’m wondering if I should scale down the ceremony or skip the honeymoon,” Eun-bi, who requested to be identified only by her first name, told Al Jazeera.

Eun-bi is among the millions of South Koreans who invested enthusiastically during the biggest stock market rally in the country’s history, making huge gains only to see much of their profits evaporate just as quickly.

Many first-time investors got into stocks at the encouragement of President Lee Jae Myung, who has promised to make South Korea’s stock market, which long lagged international peers, work for citizens.

While the market has made up some ground since July’s rout, it remains highly volatile.

On Wednesday, the KOSPI dived nearly 6 percent, following a 1.55 percent drop the previous day.