Bae Jaekyu, CEO of KTB Asset Management, "Korean Stock Market Cycle Bottom... Considering Semiconductor Investment"

Bae Jae-kyu, CEO of Korea Investment Trust Management, emphasized that since the long-term cycle of the Korean stock market is at a low point, it is time to examine current market issues such as the rise of technology stocks including semiconductors and shareholder activism, and to seek investment opportunities.

On the morning of the 19th, Bae spoke about the domestic stock market environment and investment opportunities at the "Power of Korean Investment Investment Seminar" hosted by Korea Investment Trust Management at the Four Seasons Hotel in Gwanghwamun.

Bae said, "Ten years ago, among the top 10 companies by global market capitalization, there were only two tech companies, Microsoft and Apple, but now, among the top 10 companies, only Aramco is a non-tech company," adding, "When tech companies dominate the market, the semiconductor industry is an indispensable sector."

He continued, "Our country especially has strong companies in the memory sector, which have undergone many adjustments, and now it seems to be time to consider investing."

Another theme he mentioned was investment related to shareholder return policies. Bae said, "When talking about Korean companies' stock prices, the term Korea discount often comes up," adding, "There are various reasons, but the main reason is that companies are not friendly to general investors."

He explained, "Major shareholders often do not want stock prices to rise because of inheritance tax," emphasizing, "The inheritance tax imposed on major shareholders in Korea is almost at a predatory level, and for the sustainable growth of Korean capitalism, inheritance tax must be reformed."

Additionally, he said, "I believe investments should not be made based on market forecasts or predictions," and recommended, "I strongly suggest long-term investment through diversification, with the core of the investment portfolio being more than 50% allocated to asset allocation products, and the rest invested in thematic products according to personal preference, following a core-satellite strategy."

Meanwhile, the speakers at the event included Lee Chang-hwan, CEO of Align Partners Asset Management, and Lee Hyung-soo, CEO of HSL Partners. Lee Chang-hwan is recognized as an expert in shareholder activism investment, while Lee Hyung-soo is known for his expertise in information technology (IT) and semiconductor investment.

Lee Chang-hwan pointed out, "The undervaluation of the Korean stock market stems from weak corporate governance," adding, "In addition to the world’s highest inheritance tax rates and high dividend income tax rates, unlike overseas countries such as the U.S., domestic commercial law and precedents regulate directors' fiduciary duties only to the 'company' and not to 'shareholders,' causing directors to work solely for the benefit of major shareholders." Lee Hyung-soo forecasted, "In the first half of this year, semiconductor stocks surged as the bottom of the artificial intelligence (AI) and memory cycles overlapped, but the atmosphere may change in the second half. Demand for smartphones, PCs, and general servers is recovering, which could lead to a leveling of stocks related to all manufacturing processes."