NVIDIA 24.7%→21.7%
Samsung Electronics 16.3%→3.3%
SK Hynix newly included at 16.6%
Korea Investment Management has significantly reduced the weighting of Samsung Electronics in its exchange-traded fund (ETF) that invests in major global semiconductor companies. Instead, it newly included SK Hynix and changed the portfolio to focus on concentrated investment stocks.
According to the financial investment industry on the 6th, Korea Investment Management effectively excluded Samsung Electronics from the main stocks and replaced it with SK Hynix through the rebalancing of the 'AEC Global Semiconductor TOP4 Plus SOLACTIVE ETF' on the 8th of last month. ETF rebalancing is a natural process. Portfolios are regularly adjusted to improve returns.
The change is noticeable in the stock weightings. Since last month, the main stocks of the ETF have been changed to TSMC (21.7%), Nvidia (20.6%), ASML (20.5%), and SK Hynix (16.6%). Previously, the main stocks were Nvidia (24.7%), TSMC (22.4%), ASML (18.1%), and Samsung Electronics (16.3%).
The biggest difference is the replacement of the domestic semiconductor main stock from Samsung Electronics to SK Hynix. The weighting of Nvidia, which has led the artificial intelligence (AI) boom, was also slightly reduced. Instead, the weightings of TSMC and ASML were slightly increased.
Korea Investment Management significantly lowered Samsung Electronics' weighting to reflect the latest semiconductor industry trends. Although there are recent forecasts of a peak-out in the semiconductor market, the current semiconductor industry and stock market are led by AI semiconductors.
Accordingly, the high-bandwidth memory (HBM) market, a key component, is also receiving attention. The industry expects the AI market to grow at an average annual rate of 27%. The HBM market is also expected to grow at an average annual rate of 109% until 2025.
SK Hynix recorded the world's number one market share in the HBM market in the first quarter of 2024 (59%). Samsung Electronics, a competitor in the HBM market, holds 37%, and Micron holds about 4%. SK Hynix is thus dominating the HBM market.
A senior official at Korea Investment Management explained the background of the rebalancing, saying, "SK Hynix has a high correlation with other sector-leading stocks in the semiconductor industry such as Nvidia, TSMC, and ASML. Since the semiconductor industry is one where leading companies in each sector have an organic relationship and grow together, we judged that SK Hynix would also receive substantial benefits in the AI semiconductor industry."
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