Key Takeaways
- • Koscom ETF Check data as of May 18 shows 391 of South Korea's 1,107 listed ETFs hold Samsung Electronics and 386 hold SK Hynix, meaning roughly one in three domestic ETFs is exposed to one or both chip stocks.
- • Samsung Asset Management restructured its KODEX AI Semiconductor ETF (renamed KODEX AI Semiconductor TOP2 Plus) to allow up to 25% each in Samsung Electronics and SK Hynix, a combined maximum of 50%, with holdings cut from 24 to 15.
- • Among the 391 ETFs holding Samsung Electronics, 59 allocate more than 30%; the TIGER Semiconductor TOP10 Leverage ETF has SK Hynix at 49.5% of assets.
- • Retail dollar-cost averaging plans via Korea Investment & Securities' Stock Accumulation service put SK Hynix (24%) and Samsung Electronics (22.8%) at the top of domestic purchases, with semiconductors exceeding half of the total when Samsung preferred shares are included.
- • Market experts warn the concentration could amplify volatility on the Korea Exchange, a risk expected to grow with single-stock leveraged ETFs on the two names slated to launch on May 27.
Summary
Concentration risk is intensifying in South Korea's exchange-traded fund market, with asset managers funneling capital into Samsung Electronics and SK Hynix. According to data from Koscom ETF Check on May 18, 391 of the 1,107 ETFs listed in South Korea include Samsung Electronics and 386 hold SK Hynix. Weightings have also risen sharply: 59 of the Samsung-holding funds allocate more than 30% to the stock, the TREX Fundamental 200 carries Samsung at 37.6%, and the TIGER Semiconductor TOP10 Leverage ETF holds SK Hynix at 49.5%.
Samsung Asset Management recently overhauled its KODEX AI Semiconductor ETF, allowing 25% allocations each to Samsung Electronics and SK Hynix, up from a single-stock cap of around 20%. The fund was renamed KODEX AI Semiconductor TOP2 Plus and its holdings were reduced from 24 to a maximum of 15. In March, Korea Investment Management renamed its ACE AI Semiconductor Focus ETF to ACE AI Semiconductor TOP3+. Critics have dubbed these products "Samsung-Hynix theme ETFs." South Korea's Capital Markets Act requires ETFs to hold at least ten stocks with a 30% single-stock cap, but the article notes that index-tracking and leveraged products are increasingly skirting these limits.
Retail behavior mirrors the trend. Data from the Stock Accumulation service launched last month by Korea Investment & Securities show SK Hynix (24%) and Samsung Electronics (22.8%) ranked first and second by domestic stock purchase amount. Weekly investing was most common at 39.7%, followed by monthly (37.9%) and daily (22.4%). For overseas investing, four of the top five purchases were domestically listed ETFs tracking the S&P 500 or Nasdaq 100, largely through ISA accounts that cannot directly hold overseas stocks.
Samsung Asset Management CEO Kim Woo-seok said in an interview that "the ETF market is ultimately a content battle," and that the firm will focus on semiconductor, AI, and covered call themes. Analysts warned of volatility risk. SK Securities analyst Cho Jun-kee said price swings are becoming especially violent for large-cap stocks as ETF trading volume grows, while Kiwoom Securities analyst Han Ji-young cautioned that a correction in a handful of related stocks could trigger broader index volatility. With single-stock leveraged ETFs on Samsung Electronics and SK Hynix set to launch May 27, and 59,716 investors having completed the required pre-education course as of May 15 according to the Korea Financial Investment Association, analysts expect concentration to deepen.
Samsung Asset Management recently overhauled its KODEX AI Semiconductor ETF, allowing 25% allocations each to Samsung Electronics and SK Hynix, up from a single-stock cap of around 20%. The fund was renamed KODEX AI Semiconductor TOP2 Plus and its holdings were reduced from 24 to a maximum of 15. In March, Korea Investment Management renamed its ACE AI Semiconductor Focus ETF to ACE AI Semiconductor TOP3+. Critics have dubbed these products "Samsung-Hynix theme ETFs." South Korea's Capital Markets Act requires ETFs to hold at least ten stocks with a 30% single-stock cap, but the article notes that index-tracking and leveraged products are increasingly skirting these limits.
Retail behavior mirrors the trend. Data from the Stock Accumulation service launched last month by Korea Investment & Securities show SK Hynix (24%) and Samsung Electronics (22.8%) ranked first and second by domestic stock purchase amount. Weekly investing was most common at 39.7%, followed by monthly (37.9%) and daily (22.4%). For overseas investing, four of the top five purchases were domestically listed ETFs tracking the S&P 500 or Nasdaq 100, largely through ISA accounts that cannot directly hold overseas stocks.
Samsung Asset Management CEO Kim Woo-seok said in an interview that "the ETF market is ultimately a content battle," and that the firm will focus on semiconductor, AI, and covered call themes. Analysts warned of volatility risk. SK Securities analyst Cho Jun-kee said price swings are becoming especially violent for large-cap stocks as ETF trading volume grows, while Kiwoom Securities analyst Han Ji-young cautioned that a correction in a handful of related stocks could trigger broader index volatility. With single-stock leveraged ETFs on Samsung Electronics and SK Hynix set to launch May 27, and 59,716 investors having completed the required pre-education course as of May 15 according to the Korea Financial Investment Association, analysts expect concentration to deepen.
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