Understanding Korean Composite Stock Price Indexes
Korean Composite Stock Price Indexes (KOSPI) are a collection of indexes tracking the performance and components of the Korean Stock Exchange. Each KOSPI index is a capitalization-weighted market average, reflecting the value of its listed companies.
Among these, the most renowned is the KOSPI 200, comprising the 200 largest publicly-traded stocks in Korea. It accounts for approximately 70% of the total market value of the Korean Stock Exchange. Investors and traders often use the KOSPI 200 as a benchmark to gauge the market’s health, similar to how the S&P 500 is used in the U.S.
As of 2021, notable components of the KOSPI 200 include:
- Samsung Electronics (Consumer Products)
- Hyundai Motor (Automotive)
- SK Hynix (Semiconductors)
- Korea Electric Power (Utilities)
- Shinhan Bank (Finance)
A Rich History with KOSPI’s Origins
The Korean Composite Stock Price Indexes debuted in the early 1980s. Various versions have since emerged, such as KOSPI 100 focusing on mid-cap stocks and KOSPI 50 representing small-cap stocks. Additionally, specialized indexes for industries like chemicals and banks, as well as the KODI index for dividend stocks, fall under the KOSPI umbrella. The KOSPI family also extends to financial instruments, tracking futures, options, and sovereign bonds.
Celebrating Key Milestones: The Story of KOSPI 200
The KOSPI 200 began trading on January 3, 1983, starting at 122.52. With a base value set on January 4, 1980, at 100, the index has seen remarkable growth, rising more than eightfold to surpass 1,000 by April 1989. It marked its 30th anniversary with a value of 1,997.06 in 2012, trailing only the Hong Kong and Taiwan Stock Exchanges during the same period. By mid-2018, the KOSPI 200 value had surged over 20-fold, reaching approximately 2,470.
Noteworthy dates and events include:
- June 17, 1988: An 8.5% gain, the largest one-day percentage increase.
- September 12, 2001: A significant 12% drop following the 9/11 terrorist attacks in the U.S.
- July 24, 2007: First time closing above 2,000.
The KOSPI 200 garners attention from analysts, market participants, and international financial media, with frequent mentions in prominent outlets such as The Wall Street Journal, Bloomberg, and Reuters.
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Related Terms: Stock Index, Market Capitalization, Large-cap Stocks, Investment Performance.
References
- Corporate Finance Institute. “Korean Composite Stock Price Index (KOSPI)”.
- BlackRock. “iShares Core KOSPI 200 ETF”.
- Yahoo Finance. “KOSPI Composite Index (^KS11)”.
