Samsung Electronics' production line in Pyeongtaek, Gyeonggi Province / Courtesy of Samsung Electronics
Asset management firms are accelerating the launch of semiconductor-themed exchange-traded funds (ETFs) while aggressively increasing exposure to the country’s two largest chipmakers, Samsung Electronics and SK hynix, amid the recent KOSPI rally driven largely by optimism over soaring global demand for artificial intelligence (AI) chips, industry officials and market analysts said Monday.
The trend is fueling concerns that ETFs, originally intended to provide diversified investment exposure, are becoming increasingly concentrated in the two tech giants. Market watchers warned that excessive reliance on semiconductor stocks could amplify volatility in the broader domestic equity market.
Samsung Asset Management recently revamped its “KODEX AI Semiconductor” ETF by increasing the maximum weighting of Samsung Electronics and SK hynix to 25 percent each. The previous cap for individual holdings had been around 20 percent.
The asset manager also streamlined the portfolio by reducing the number of constituent stocks from 24 to about 15.
Data from ETF Check, a platform operated by Korea Securities Computer Corp., showed that 391 out of 1,107 domestic ETFs held Samsung Electronics, while 386 products included SK hynix.
The figures indicate that about one-third of all locally listed ETFs currently contain at least one of the two semiconductor giants.
The concentration of the two companies within ETF portfolios has also intensified. Among the 391 ETFs holding Samsung Electronics, 59 products allocate more than 30 percent of their assets to the stock.
In addition, reflecting the strong momentum in chip stocks, asset managers have increasingly incorporated terms such as “AI” and “Semiconductor” into ETF names to highlight strategies centered on the chipmakers.
Market watchers said the trend runs counter to the fundamental purpose of ETFs, which is to reduce risk through diversification across a broad range of assets.
Source: Korea Times News
