KOSDAQ Index

Definition

The KOSDAQ (Korean Securities Dealers Automated Quotations) is the trading board of the Korea Exchange (KRX) dedicated to small-to-medium enterprises (SMEs) and venture companies. Modeled after the U.S. Nasdaq*, it serves as a capital funding platform for innovative tech companies.

Key Sectors

Unlike the manufacturing-heavy KOSPI, KOSDAQ is driven by future growth industries. * Biotech & Pharma: Historically the most influential sector in KOSDAQ. * EV Batteries: Companies producing materials for electric vehicle batteries (like EcoPro BM) carry significant weight. * K-Pop & Gaming: Major entertainment agencies and game developers are listed here.

Characteristics: The Wild West

• High Volatility: Stocks on KOSDAQ tend to fluctuate wildly. It offers the potential for massive gains but comes with a high risk of loss.
• Retail Dominated: While institutions dominate the KOSPI, the KOSDAQ market is heavily driven by individual investors (often called "Ants" in Korea).
• Speculative: It is prone to bubbles and thematic trading frenzies.

The Benchmark

• Base Index: Set at 1,000 points (adjusted from the original 100 base to boost psychological sentiment after the Dot-com crash).
• If KOSPI represents the current stability of the Korean economy, KOSDAQ represents its dynamic (and sometimes chaotic) future potential.