Nextrade's headquarters in Yeouido, western Seoul, March 31 (Yonhap)
Nextrade's headquarters in Yeouido, western Seoul, March 31 (Yonhap)

South Korea's first alternative stock exchange Nextrade has successfully settled down, taking up an average of 20 percent market share — double its initial target.

According to the company on Friday, its daily trading volume stood at 6.05 trillion won ($4.34 billion) on Wednesday, reaching the highest since the service went live in March. Stocks worth 4.21 trillion won were traded during the main market hours, while transactions during the premarket and after-market hours amounted to 1.83 trillion won.

On the same day, the Korea Exchange, the country’s main bourse operator, handled transactions worth 16.3 trillion won, indicating that Nextrade secured over 20 percent of the market share. The Korea Exchange and Nextrade are the only two market operators here.

Since expanding its trading service to 796 shares on March 31, the alternative exchange has recorded over 20 percent market share every week.

The 20 percent figure is considered a feat for Nextrade, as it initially targeted to take up a 10 percent market share in three years from its launch.

The alternative bourse has succeeded in attracting foreign investors as well. Offshore investors, who accounted for 0.4 percent of the total trading volume on the platform in March, took up 8.6 percent in the second week of May. The trading days during the week were from May 7 to May 9 due to the public holidays.

“Nextrade was able to secure its footing in a short period as it was able to attract more retail investors to the stock market by extending the trading hours," said Ahn Young-jun, an analyst at Kiwoom Securities.

Yet, Nextrade continues to struggle with attracting institutional investors. The trading volume of institutional investors remains at around 1 percent, while retail investors take up more than 90 percent of the market.


silverstar@heraldcorp.com