Gambling addiction spikes among S. Korea’s work-from-home day traders

  • Business
  • Wednesday, 22 Jul 2020

SEOUL: Day traders seeking help for gambling addiction have tripled in number in South Korea, as Covid-19 social distancing and working-from-home has freed up more time for online stock market trading, data showed.

Retail investors, known locally as ants, were a force in a 50% stock-price surge after a virus-induced sell-off in March.

From then through May, however, those seeking help for trading-related addictive behaviour reached 214, showed data from the Korea Centre on Gambling Problems. The growth rate eclipsed the overall 16% rise in calls seeking help.

The trend is a worrying sign of things to come should social distancing practices such as work-from-home become the norm, experts said, as isolated individuals have even fewer mechanisms such as peer support to check addictive behaviour.

Compulsive stock trading also lacked the social stigma that may act as a deterrent toward traditional forms of gambling, even though the stimulation behind both is similar, they said.

South Korea has not enforced any virus-busting lockdown measures, even during the height of the outbreak in the country over February and March. Nevertheless, people and businesses by and large have followed government guidelines and refrained from social gatherings and instituted work-from-home arrangements.

One such individual was 35-year-old bank employee surnamed Lee. He has been trading shares online for over a year since hearing of a friend who made a windfall through frequently buying and selling stocks based on rumour and speculation.

Though Lee has seen some success – once making a profit of several hundred thousand dollars in a single trade – increased trading time afforded by working-from-home culminated last month in him losing 1.2 billion won (US$1mil) over five days.

On the insistence of his wife, he said, he subsequently sought help from a gambling addiction counsellor.

“We tend to see an influx of people seeking help after a huge market dive, ” said Kim Yeon-su, treatment manager at the Korea Centre on Gambling Problems help centre in Seoul. “It happened with Bitcoin and now it’s happening with stocks.”

Active trading accounts – the bulk of which belong to retail investors – rose 2.8 million from mid-January through mid-July, versus 1.6 million in the same period last year, financial association data showed. — Reuters

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