Investing should be based on thorough analysis. The current global AI technology revolution is poised to create a cohort of exceptional companies. However, the rapid surge in prices has pushed valuations to historically high levels, with the risk of a bubble bursting looming ever closer.
At 8:00 AM on June 2nd (7:00 AM Beijing time), the pre-market auction began on the Korean stock exchange. In Siheung, Gyeonggi Province, Zhang Yan, who has lived there for nearly 20 years, had just woken up and immediately opened his phone app to check the price movements of his watchlist stocks.
Simultaneously, Zhang Yan scanned news about the chip and semiconductor industries. With the market opening at 9 AM daily, he needed to be fully prepared for post-opening trading. This routine has been his life for over four months.
Originally from Yanbian, Jilin, Zhang Yan holds permanent residency in South Korea. He had no prior connection to the stock market until February, when friends around him began entering the market, and stories of making money were everywhere. Unable to resist, he too started paying attention to the Korean stock market.
On February 11th, after opening a brokerage account, Zhang Yan invested approximately 10 million won (around 50,000 RMB) into a construction sector stock. This initial investment was modest, purchasing fewer than twenty shares. After holding for about half a month and selling, he made a profit of roughly 100,000 won.
Zhang Yan is just one ordinary retail investor amid South Korea's "stock trading fever," a scene of全民炒股 that has become commonplace.
Not even halfway through 2026, the Korea Composite Stock Price Index (KOSPI) has surged over 106%. Extending the view to the past year, from its low in April 2025 to now, the index has climbed from 2,284.72 points to over 8,600 points, a gain exceeding 270%. This not only set a new all-time high but also marked the longest continuous rising cycle since 1999. South Korea's total stock market capitalization leaped to become the world's sixth-largest, surpassing markets like India and Canada.
Leading tech stocks SK Hynix Inc (000660.KS) and Samsung Electronics Co Ltd (005930.KS) have been particularly dazzling. Wind data shows that over the past year from June 5, 2025, to June 5, 2026, SK Hynix skyrocketed 825.74%, while Samsung Electronics surged 566.51%. In early June, SK Hynix's market capitalization surpassed $1 trillion, becoming the third Asian tech company, after Samsung Electronics, to join the "trillion-dollar club."
Consequently, office workers checking prices during breaks, minors opening accounts, and leveraged funds flooding the market... South Korea's younger generation is pouring into this capital feast with unprecedented fervor.
On June 5th, the Korean stock market opened lower across the board, with the KOSPI gapping down significantly and continuing to slide, falling over 6%. The Korea Exchange triggered a circuit breaker for the KOSPI as the KOSPI200 futures fell 5%, halting program trading for five minutes. By the close, the KOSPI settled at 8,160.59 points, down 5.54%. Among individual stocks, SK Hynix fell 9.92%, and Samsung Electronics dropped 6.64%.
The全民炒股 Phenomenon
After his initial taste of success, daily monitoring of the market became part of Zhang Yan's life.
Over the months, he successively bought into optical communication, cosmetics, shipping, crude oil, semiconductor-related concept stocks, and other targets, mostly engaging in short-term trades. Holding periods ranged from a few days to 15 days, with some even bought and sold on the same day.
As a new investor, Zhang Yan is not "knowledgeable" and can only trade based on the day's行情. He trades part-time, admitting he "doesn't expect to make big money; survival is the primary goal." Simultaneously, he began recording daily investment insights on social media, sharing real-time Korean market conditions with Chinese investors. His account started from zero and gained over 2,000 followers in a month and a half.
Why not buy leading stocks like SK Hynix and Samsung Electronics? Zhang Yan explained that back in February, SK Hynix shares had already soared to about 800,000 won per share (approximately 4,200 RMB), while his initial capital was only 1 million won, enough for just one share.
As the KOSPI index continuously刷新历史高点, an anxiety known as "Fear Of Missing Out" (FOMO) has been quietly spreading through South Korean society.
According to reports, the staff restrooms in a department store in Seoul's Gangnam District are always packed at 3:30 PM, with employees挤在隔间里 refreshing stock quotes on their apps, not wanting to miss the last opportunity before the close.
Goldman Sachs data shows that over the past five years, the total number of Korean stock trading accounts has doubled. By the end of February 2025, the number of active accounts exceeded 102 million, while South Korea's total population is about 51.6 million—averaging nearly two accounts per person. Approximately one-third of the population directly participates in stock trading, a proportion nearly five times that before 2020 (7%).
Even more striking, according to TossSecurities data, in the first quarter of this year, new account openings by South Koreans under 18 years old surged nearly tenfold year-over-year.
SWS Research data points out that from the perspective of investor structure, since March 2026, both individual and institutional investors have been accelerating their inflows into the Korean stock market. Securities fund transfers have risen rapidly since March 2026, averaging 1,644 trillion won per month from March to May, significantly higher than the 2025 monthly average of 1,098 trillion won. Furthermore, the proportion of global funds and emerging market funds allocated to Korean stocks has also reached historically high levels. Sector-wise, these funds primarily flowed into the technology industry, with inflows reaching $16.7 billion since 2026.
A Chinese student studying in South Korea mentioned that many classmates watch stocks during lectures, truly a sign of全民炒股.
In the Korean Chinese stock chat group (KakaoTalk group) established by Zhang Yan, participants are mostly业余投资者, still primarily Chinese migrant workers, including some investing over ten million won.
Zhang Yan also observed that if retail investors did not trade leading stocks like SK Hynix and Samsung Electronics, it was actually difficult to make money. After mid-May, the创业板, some semiconductor concept stocks, and the optical communication sector underwent corrections, with funds持续向大市值龙头集中,呈现“一九分化”的畸形结构.
"A normal stock market should see every sector thriving; it's too extreme now," Zhang Yan said.
Heavyweight Stocks Driving the Bull Market
"Chairman, we're taking huge losses in the memory price war. Why do we insist on continuing?" "Do you know why? Last year when our factory had a strike demanding higher wages, I knew businesses relying on manpower were over. From now on, we must do business with technology; semiconductors are our future."
These are two lines from the 2022 Korean drama "Reborn Rich." Why can Korean semiconductor stocks like SK Hynix achieve today's performance? The above台词或许已给出了答案.
This round of the Korean stock market surge is inseparable from the powerful pull of core heavyweight stocks.
When交流 with several investors, they unanimously mentioned Samsung Electronics, LG Electronics Inc (066570.KS), and SK Hynix. Jiang Cheng, who has lived in South Korea for over a decade, noted: Samsung Electronics and SK Hynix together account for over 40% of the Korean stock market's weighting. Buying these two is equivalent to buying an ETF for the Korean stock market.
Jiang Cheng is a self-media blogger who started接触股票 in 2020. His first investment in Korean stocks began with losses—buying便宜标的 like Jeju Air, resulting in his 30,000 RMB principal shrinking by nearly half in a week.
"I entered the market and immediately saw a 30%–40% drop, but I was fortunate to encounter a暴跌 right from the start. This made me格外谨慎 about position control; no single stock position exceeds 10% of my principal," Jiang Cheng said.
Jiang Cheng began self-studying investment knowledge, reading大量投资经典,自学财务报表, and books by Warren Buffett, Peter Lynch, and Charlie Munger, gradually developing "his own analytical framework." He believes that chip manufacturing by upstream giants like NVIDIA Corp (NVDA) and Taiwan Semiconductor Manufacturing Co Ltd (TSM)离不开HBM (High Bandwidth Memory) and DRAM (Dynamic Random Access Memory). Aside from Micron Technology Inc (MU), 70%–80% of the mainstream market is occupied by Samsung and SK Hynix. Therefore, if investing in the Korean stock market, Samsung Electronics and SK Hynix are unavoidable investment标的.
Starting in 2021, Jiang Cheng began buying and长期持有 Samsung Electronics and SK Hynix, with average purchase prices around 76,000 won and 128,000 won per share, respectively.
"After President Lee Jae-myung took office, he revised many policies, forcibly redirecting a lot of capital previously tied up in real estate towards the stock market. Coupled with South Korea正好赶上了AI的风口, the combination爆发出了巨大的效应. The share prices of Samsung and SK Hynix have multiplied several times over the past year," Jiang Cheng stated, adding that he is not in it for quick profits but is betting on the future of South Korea's semiconductor industry.
Over the past year, because Samsung Electronics and SK Hynix rose too quickly, exceeding Jiang Cheng's expectations, he has been减仓锁定利润 during the ascent. To date, in Jiang Cheng's portfolio, SK Hynix is mostly cleared with little remaining, while he still holds a portion of Samsung Electronics.
Samsung Electronics is a global dual leader in consumer electronics and semiconductors. Its business spans终端产品 like smartphones, TVs, and home appliances, while also holding a leading global position in memory chips (DRAM, NAND Flash). SK Hynix is another global memory chip giant. As a core supplier to NVIDIA, its share price has surged over 200% this year. LG Electronics' main business covers consumer electronics, home appliances, and automotive components, also a leading global consumer electronics and home appliance manufacturer.
Huatai Securities research data shows the Korean stock market has a明显的科技产业导向与头部效应. As of May 12, 2026, the market capitalization shares of Samsung Electronics, SK Hynix, Hyundai Motor Co (005380.KS), and LG Energy Solution Ltd (373220.KS) on the main board were 26.9%, 21.5%, 2.2%, and 1.7%, respectively. Adding other major listed entities within these groups (12 for Samsung, 19 for Hyundai, 16 for LG, 9 for SK), the four major chaebols (Samsung, Hyundai, LG, SK) would account for nearly 70% of the main board's market capitalization.
Investors Caught in Positions
Despite the impressive gains in leading stocks, some investors have been套牢 in South Korea's "bull market." "Sigh, I'm stuck in one right now," sighed Xu Bing, a student in South Korea, over the phone.
Earlier this year, she saw more people discussing Korean stocks on Xiaohongshu and朋友圈, with some喊出“看高到200万”. Without much thought, Xu Bing opened a Korean securities account and rushed in. Even then, some had warned her it was "too high."
Over more than half a year, Xu Bing invested about 9 million won (approximately over 40,000 RMB). She also bought SK Hynix—bought at over 800,000 won and sold at over 1 million; and bought Samsung Electronics—bought at 160,000 and sold at over 180,000. Now, SK Hynix has risen to over 2 million won, and Samsung Electronics is nearing 350,000 won. "If I had held until now, I'd be sitting pretty," Xu Bing said with a bitter laugh.
What套牢 her was another stock. In May, Xu Bing bought a newly listed "physical AI" defense concept stock with an发行价 of only about 15,000 won. After listing, it连续暴涨, rising 300% and triggering a circuit breaker on the first day, and later climbing to 87,000 won per share in subsequent days. She bought in at the peak of 87,000 won per share. "After buying, it started falling—60,000, 40,000, 30,000... By June 3rd, the stock was at 28,000," Xu Bing said. Unwilling to accept, she一路补仓. Now, she has almost all her funds tied up in this single stock, with an average cost of about 53,000 won per share, while the share price remains at only 28,000 won.
Huatai Securities points out that from an investor structure perspective, a "散户市" remains the main characteristic of the Korean stock market. Since 2008, the median proportion of individual investor trading volume has exceeded 50%,略降至 43.7% in 2025. Foreign institutional ownership has slowly risen to 34.7%, while local institutional ownership is below 20%. Among foreign capital, U.S. and European funds account for 41.6% and 30.3%, respectively.
The mentality of retail investors追涨杀跌, unable to hold onto winning stocks, is no different between China and South Korea. Having experienced these起伏, Xu Bing also feels she needs to learn more about investing.
Vigilance Against Stock Market Bubbles
Across the screen, A-share investors have mixed feelings. Some envy the Korean stock market for possessing "AI hard assets" like SK Hynix and Samsung Electronics, while others直言“现在涨得多疯，未来跌得可能多狠”. "If these heavyweight stocks fall, the大盘 will drop, and small个股几乎无一幸免," Xu Bing herself worries about股市泡沫风险, fearing the higher it rises, the more怕“一下崩了”.
Regarding the后续市场, Jiang Cheng remains optimistic. He believes the KOSPI has already risen to a relatively high level but might still surge further within six months. However, by the end of 2026 or 2027, a significant correction is highly likely, and the index砸回五六千点 is not impossible. Therefore, he is currently囤积现金,保持观望.
On June 4th, the KOSPI fell 1.84%. Simultaneously, South Korea's finance minister expressed concern over the increase in leveraged stock investments and stated actions would be taken to address "herd behavior" in financial markets.
From a capital flow perspective, SWS Research data indicates foreign inflows into Korean stocks were concentrated in the first quarter of 2026, with the pace of inflows slowing after March 2026. Foreign selling was mainly triggered by index weight imbalances leading to被动卖出. The two chip giants, Samsung Electronics and SK Hynix, together account for about 50% of the KOSPI's total market capitalization, far exceeding the 25% holding limit stipulated by the U.S. Investment Company Act. Fund managers focused on the Korean market were forced to systematically减仓 these two overweight leading stocks to重建合规的投资组合.
From a historical perspective of牛熊转换, Huatai Securities research统计 shows that since 1980, the Korean stock market has experienced multiple bull-bear转换 cycles,大致经历了6个宏观阶段:
First, 1980–1989: Index震荡上行 driven by rapid industrialization. Second, 1989–2002: Increased market volatility amid economic转型与对外开放, with frequent牛熊切换 and overall震荡. Third, 2003–2008: Further development of high-tech industries driven by economic换挡, coupled with a长期牛市 following institutional entry. Fourth, 2008–2019: Long-term震荡 as economic growth faced瓶颈期. Fifth, 2020–2024: Overall bearish trend due to post-pandemic recovery and political factors. Sixth, 2025–present:斜率显著提升的牛市行情 catalyzed by stock market reforms and the AI industry wave.
Overall, the Korean stock market follows a pattern of "牛短熊长". Its highly concentrated industry structure and "foreign capital pricing + retail investor主体" investor structure共同决定了 it is a high-volatility博弈市场极易受全球半导体周期 and U.S. dollar liquidity影响, which is the核心特征 of the Korean stock market.
Huatai Securities believes that when the牛市逻辑 driven by semiconductor景气度, foreign inflows, or policy红利 reverses, the market is prone to快速且深度的下跌 due to预期扭转和资金撤离, with volatility攀升 during bear markets,印证了“急跌”模式.
However, as the AI热潮重塑资本市场格局, Goldman Sachs has still上调了对韩国股市的预测, raising its KOSPI target from 9,000 points to 12,000 points, one of the highest values given by Wall Street strategists. Goldman Sachs stated that AI investment will enable strong盈利成长 for tech hardware in 2028 and beyond, expecting South Korea to lead Asia with 320% profit growth this year.
Goldman Sachs also指出, the Korean market faces concentration risks. Samsung Electronics and SK Hynix currently account for over half of the total market capitalization, and with rising散户投机活动, the market is prone to回调. However, based on higher盈利预期 and a conservative 8x forward P/E ratio, Goldman Sachs remains看好后续空间.
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