Semiconductor ETFs Capture Significant Attention in Korean and Chinese Markets
In the past month, there has been a substantial flow of investment into semiconductor Exchange-Traded Funds (ETFs) in Korea, which has driven the rise of the KOSPI index. About 2.22 trillion KRW has been net invested in 22 semiconductor-related ETFs, with the TIGER Semiconductor TOP10 leading with the highest inflow. This trend is attributed to expected growth in performance based on AI data center infrastructure development and improvement in the memory market conditions. Samsung's operating profit is anticipated to surge considerably, and profitability improvements in semiconductor companies like SK Hynix are also expected. Investors are advised to consider volatility and diversification, spreading investments across semiconductor ETFs and other index and financial ETFs.
The bullish trend in the Korean stock market is also influencing Chinese retail investors, with the 'China-Korea Semiconductor ETF' being central to this movement. Listed on the Shanghai Stock Exchange, this ETF, which includes Samsung Electronics and SK Hynix in its portfolio, has become a primary means for Chinese investors to invest in Korean semiconductor stocks. It is traded at a premium, 10-20% over the actual asset value, due to its appeal. However, the ETF has been flagged for caution due to signs of overheating.
Meanwhile, there is an increasing interest in Korean-related ETFs on the U.S. market. The 'iShares MSCI Korea ETF' has seen a surge in inflows, highlighting a growing confidence and interest in the Korean market among global investors. This trend indicates that assets related to Korea are becoming attractive investment opportunities for foreign investors.
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