KO KODEX KODEX Bio ETF Loading... : Bullish and Bearish Analyst Opinions

The correlation between the US biotech ETF (XBI) and the Korean KODEX Bio ETF has broken since March. Instead of buying Korean biotech stocks hoping they will follow the US trend, it is better to directly invest in the US biotech ETF (XBI) which shows stronger momentum.

Samsung Life and Samsung C&T are Samsung group governance-axis companies that rallied into the Samsung Electronics shareholder-return announcement, and the speaker argues they remain attractive as indirect beneficiaries of Samsung's return/group value theme. He suggests using ETFs that hold both names, such as TIGER Samsung Group ETF and KODEX Samsung Group ETF, to get exposure; Samsung Life is recovering above its 2011 moving average after a drawdown.

The massive trading volume in SK Hynix single-stock leveraged ETFs (KODEX, TIGER) is fueling excessive volatility, draining liquidity from other stocks, and preventing the Samsung-SK Hynix gap from normalizing. Stopping purchases of these leveraged products alone would help stabilize the market. Moreover, if the gap widens and Hynix underperforms, these leveraged instruments will likely suffer amplified losses.

There is an unprecedented divergence between the US XBI and the Korean Bio ETF. Expecting this gap to narrow, buying the KODEX Bio ETF is a good strategy if picking individual stocks is difficult.