Individual Investors Found Better Returns at Home Than in Global Markets

Individual Investors Outperformed Abroad by Staying Home: A Closer Look at Last Year’s Stock Market Returns

Strong Domestic Performance Driven by Market Structure

Recent data shows that individual investors achieved significantly stronger stock market returns in the domestic market compared to overseas investments last year. As Korea’s stock market experienced a clear upward trend, personal investors who focused on local equities benefited more than those who allocated capital to foreign markets.

According to an analysis conducted by Mirae Asset Securities, which reviewed individual investors’ trading records from the beginning of the year through December 26, domestic stock investors recorded an average return of 46.6%. This figure more than doubled the 21% average return achieved by investors trading overseas stocks during the same period.

The analysis was based on data from approximately 3.78 million domestic stock investors and 1.01 million overseas stock investors, making it one of the most comprehensive retail-level market studies available.

A Significant Gap in Total Profit 

The difference becomes even more striking when examining total profit amounts. Individual investors generated roughly 47.8 trillion won in profits from domestic stock investments, while overseas stock investments produced approximately 7.9 trillion won in gains.

Even after accounting for the fact that domestic investors outnumber overseas investors by nearly four times, the gap in total returns remains substantial. When combining domestic and international investments, the total profit earned by individual investors reached 55.7 trillion won, underscoring the dominant contribution of the local market.

Semiconductors and AI Led the Domestic Rally

A key driver of domestic outperformance was the strength of large-cap stocks, particularly in the information technology and semiconductor sectors. The ongoing AI semiconductor cycle played a crucial role, lifting market leaders and reinforcing momentum in the KOSPI.

Individual investors who maintained exposure to these sectors were able to capture the upside created by global demand for AI-related hardware, especially memory and advanced processing technologies. The concentration of competitive semiconductor firms within the domestic market amplified these gains.

Overseas Markets: Steady but Less Explosive Growth

While overseas markets also delivered positive results, the pace of returns was relatively more moderate. AI and big-tech stocks continued to perform steadily, supported by long-term growth narratives rather than short-term market acceleration.

For example, Palantir Technologies, an AI-driven data analytics software firm, generated approximately 1.1 trillion won in investment gains as corporate and government demand for AI solutions expanded globally.

The Role of AI-Based Investment Tools

Another notable factor was the increasing use of AI-based asset management and advisory tools. According to the analysis, AI-powered portfolio solutions offered by brokerage firms helped individual investors improve decision-making efficiency, risk control, and timing—particularly in volatile market conditions.

These tools did not replace investor judgment but served as supportive systems, enhancing overall performance consistency.

What This Means for Individual Investors

Last year’s results suggest that market familiarity, sector concentration, and structural advantages played a meaningful role in investment outcomes. Rather than a simple domestic-versus-overseas comparison, the data highlights how understanding market dynamics and aligning with dominant trends can significantly influence returns.

For individual investors, the lesson is clear: diversification remains important, but strategic focus—especially during strong sector cycles—can be just as critical.

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