A growing number of investors in South Korea are borrowing money to buy stocks amid a bull run in the local market, with the amount of such loans rising to the highest-ever level, data showed Thursday.

The amount of money borrowed to buy stocks, so-called margin debt, reached 7.76 trillion won ($6.97 billion) as of Wednesday, breaking the previous record of 7.1 trillion in June 2007, according to the data compiled by the Korea Financial Investment Association.

The comparable figure was 5.77 trillion won at end-2014, but traders have taken out about 2 trillion won of additional loans so far this year as brokerage houses have lowered rates to draw more into the equity market, the KOFIA said.

The tech-laden KOSDAQ market has drawn money at a faster pace than the main KOSPI as small- and mid-size cap stocks in the bio and IT service sectors have had a stunning run this year.

The margin debt for the main bourse came to 3.23 trillion won as of Wednesday, up 27.4 percent from the beginning of the year.

The comparable figure for the KOSDAQ jumped 47.3 percent to 3.73 trillion won over the cited period, the association said. 

The sharp rise in stock investment using leveraged money has raised concerns over turbulence when the market goes down following hefty gains.

"The bull market fueled by ample liquidity moves fast," said Lee Jong-woo, a senior researcher at I'M Investment & Securities.

"More investors are trying to borrow money to buy stocks. If people borrow too much money for stock investment, they may find it hard to handle (when the market falls)." (Yonhap)