Samsung, SK Hynix, and Micron Shine in Korea: Four ETFs to Watch?
[Miser]Thank you for @Value_investing's insightful sharing. He highlighted Korea's market position in memory chips and four ETFs worth watching. Fellow investors are welcome to read the content in depth, and if interested in these targets, you can add the ETFs to your watchlist.
1. $iShares MSCI South Korea ETF(EWY)$
2. $Franklin FTSE South Korea ETF(FLKR)$
3. $PLUS Korea Defense Industry Index ETF(KDEF)$
4. $Direxion Daily MSCI South Korea Bull 3x Shares(KORU)$
Core Investment Thesis: Memory Chip Super-Cycle
Market Structure: The memory chip market is a highly concentrated oligopoly, with Samsung, SK Hynix, and Micron dominating global supply. Only the two Korean companies supply HBM (High Bandwidth Memory) chips essential for AI servers.
Price trends:
DDR5 (the latest DRAM standard) prices expected to rise ~40% quarter-on-quarter in Q1
Another 20% increase likely in Q2
SK Hynix projects HBM market to grow at a 33% compound annual growth rate from 2025-2030
Far-reaching Impact: Memory chips are entering a historic super-cycle, and Korea—with two of the world's memory giants—represents the purest AI-themed investment market.
Hyundai Motor: Valuation Reconstruction from Automaker to Tech Stock
Up 88% year-to-date, with market cap surpassing General Motors. Key catalysts:
CES 2025: Boston Dynamics' Atlas robot demonstration went viral (high mobility, industrial-grade perception, automated battery swapping, water resistance)
Important Background: Boston Dynamics is a Hyundai subsidiary
Commercialization Path: Atlas expected to enter Hyundai factories by 2028, already integrating Google DeepMind technology
Investment Thesis: Market is re-valuing it from a traditional automaker to a tech-driven mobility and robotics play
Policy and Valuation Support
Policy Push: Authorities urging companies to improve shareholder returns and clean up zombie firms
Valuation Advantage: Korean equities still trade at a discount to global averages on standard metrics
Official Target: Korea Exchange CEO floated KOSPI target of 6,000 points (vs. current ~4,976)
In-depth Comparison of Four Core ETFs
ETF | AUM (Size) | Expense Ratio | YTD 2026 | Core Holdings / Exposure | Key Features | Suitable For |
EWY | $10B | 0.59% | 19.31% | Samsung + SK Hynix + Hyundai; Tech weight 48.6% | Largest fund, strongest liquidity, $1.1B net inflows YTD | Core allocation / mainstream investors |
FLKR | $300M | 0.09% | 18.28% | More diversified holdings | Lowest fee, but relatively low liquidity | Cost-sensitive long-term investors |
KDEF | $57.35M | 0.65% | 27.37% | Defense industry theme | Lower semiconductor exposure; AI theme rotation adds defensiveness; up 31% YTD | Thematic investors or hedging allocation |
KORU | $300M | 0.99% | 65.50% | Tracks KOSPI 200 (3x leverage) | Extremely volatile; only suitable for short-term trading, not long-term holding | High-risk short-term traders |
Investment Recommendations
Core Position: $iShares MSCI South Korea ETF(EWY)$ (balances liquidity and representation) or $Franklin FTSE South Korea ETF(FLKR)$ (clear expense ratio advantage)
Risk Hedge: If concerned about AI theme overheating, $PLUS Korea Defense Industry Index ETF(KDEF)$ can serve as a defensive allocation
Short-term Trading: $Direxion Daily MSCI South Korea Bull 3x Shares(KORU)$ only for professional investors with strict stop-loss discipline
Entry Timing: Monitor memory price trends and correlation with U.S. AI sector sentiment
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