Single-stock leveraged product improvement push... secondary surgery looms | Myung Min-jun, Park Ga-young, Lee Da-sol

Summary

Lee Da-sol, branch manager at Meritz Securities Gangnam Premier Center, discusses how single-stock leveraged ETFs have injected severe volatility and distorted supply/demand in the Korean market, dragging down fundamentally sound companies. He points to two deeply undervalued sectors that should recover as the AI investment cycle continues and consumer spending improves: semiconductor materials/parts/equipment and export-oriented consumer goods. He also urges investors to concentrate on high-conviction names and maintain emotional discipline during the turbulent period.

• Single-stock leveraged ETFs have caused unusual intraday volatility and forced indiscriminate selling of good companies.
• The AI capex cycle now favours semiconductor materials/parts/equipment, which have fallen sharply despite rising earnings estimates.
• Export‑heavy consumer stocks with strong Korean cultural appeal are trading at multi‑year low multiples, poised for normalisation.
• The speaker recommends focusing on companies where export share is above 30% (ideally 50%) for consumer plays.
• Portfolio advice: compress number of holdings into highest‑conviction names rather than exiting equities entirely.
• The government is considering measures such as raising margin requirements to curb leveraged ETF excesses.