One day after a Korean stock exchange official called the shares of Hanjin Shipping Co.“trash,” investors piled in, sending them 15 percent higher.
The company, on the verge of bankruptcy, is a darling of retail investors. Volatility is reaching a record, while the stock was the most-traded on the Kospi index in the past two days.
“Retail investors are buying the stock so they can make double-digit profits — 10% or 20% a day,” said Kim Seung Churl, an analyst at Meritz Securities in Seoul. “The volatility for this kind of company is really high.”
Foreign investors sold a net 2 billion won of Hanjin Shipping’s shares since Jan. 9, while individual investors bought a net 1.9 billion won worth during the period, according to data from the Korean stock exchange.