**Balance of $427.4 Billion… Foreign Stock Investments Increase by $12.6 Billion Due to Valuation Gains and Investments**
In the third quarter (July to September) of this year, domestic institutional investors’ overseas foreign currency securities investment balance increased by nearly $22 billion, influenced by the rise in major countries’ stock prices and a decline in interest rates.
According to the “Overseas Foreign Currency Securities Investment Trends in the Third Quarter” report released by the Bank of Korea on the 29th, the foreign currency securities investment balance of major domestic institutional investors (market value basis) was calculated to be $427.41 billion (approximately 595.9 trillion KRW) at the end of September.
This marks a 5.4% increase ($21.96 billion) in three months compared to the end of the previous second quarter ($405.45 billion).
By type of investor, the investment balances of asset management companies (+$13.77 billion), insurance companies (+$4.51 billion), foreign exchange banks (+$2.09 billion), and securities companies (+$1.59 billion) all increased.
Among investment asset products, the increase in foreign stocks was the largest at $12.58 billion, and foreign bonds also rose by $7.85 billion. Even foreign currency-denominated securities (Korean Paper) issued abroad by domestic financial institutions or companies increased by $1.53 billion.
A Bank of Korea official explained the background of the increase in overseas securities investments, stating, “Valuation gains were realized in foreign stocks and bonds due to rising stock prices and falling interest rates, and the expansion of foreign stock investments also contributed.”
In fact, in the third quarter, the MSCI (Morgan Stanley Capital International) developed market index rose by 6.0%, and the U.S. Treasury yield (10-year) dropped from 4.40% at the end of the second quarter to 3.78% at the end of the third quarter.