Amid AI frenzy, net foreign fund inflow hits high in 2024

Taipei, Jan. 7 (CNA) The net inflow of funds from foreign institutional investors set a new high in 2024, amid global interest in advances in artificial intelligence and Taiwan's tech sector, according to the Financial Supervisory Commission (FSC).

Data compiled by the FSC, the top financial regulator in Taiwan, showed that foreign institutional investors registered a net fund inflow of US$37.196 billion in 2024, the highest level since the commission began tallying such flows in 2011.

The 2024 figure eclipsed the US$29.478 billion in net fund inflows in 2023, as the Taiex, the Taiwan Stock Exchange's benchmark weighted index, soared 28.47 percent.

In December alone, foreign institutional investors recorded a net fund inflow of US$5.68 billion, reversing a net fund outflow of US$1.297 billion in November, the FSC said.

From 2011 to the end of 2024, foreign institutional investors recorded a net fund inflow of US$282.69 billion.

With foreign institutional investors investing heavily in big AI-related names in 2024, the combined market capitalization of chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), smartphone IC designer MediaTek Inc. and IC packaging and testing services provider ASE Technology Holding Co. rose by more than NT$13 trillion, the FSC said.

As a result, foreign institutional investors owned 43.09 percent of the main exchange and over-the-counter (OTC) market at the end of 2024, when total market capitalization hit NT$80.40 trillion (US$2.5 trillion), the FSC said.

The 43.09 percent was up from the 38.47 percent seen at the end of 2023, the FSC said.

Despite foreign institutional investors' high level of holdings in the market and net inflow of funds, the FSC said those investors were actually net sellers of NT$682.57 billion (US$21.26 billion) in shares on the main exchange and OTC market, the FSC said.

Market analysts said the numbers indicated that many foreign institutional investors were keeping funds in Taiwan after cashing out some of their stock holdings, looking for other investment opportunities in the local market.

According to the FSC, the aggregate sales posted by companies listed on the main exchange and the OTC market hit a new high of NT$3.946 trillion in the first 11 months of 2024, up 11.98 percent from a year earlier.