You Can Make a Profit If You Are Not Deceived by KOSPI Volatility

Summary

Lee Ji-hwan, CEO of Aurora Investment Advisory, explains why KOSPI's extreme volatility is structural and driven by changes in market participants, particularly the rise of individual investors using ETFs. He argues the recent semiconductor sell-off lacks fundamental reasons and presents a buying opportunity in leaders Samsung Electronics and SK hynix, backed by strong AI memory demand and upcoming earnings. He also warns against single-stock leveraged ETFs due to their risk and structural drawbacks.

• KOSPI sidecar triggered 27 times this year, half on up and half on down days, showing persistent extreme volatility.
• Volatility is structural because the dominant marginal buyers are now individuals via ETFs, who cannot control swings like long-term foreign funds.
• The recent semiconductor sell-off was driven by profit-taking ahead of Micron earnings and macro fears, not fundamental damage.
• Samsung Electronics gained memory market share and its July 6 Q2 earnings are expected to be very strong, supporting the stock.
• SK hynix’s HBM dominance and margin expansion could push the stock toward 450,000 won.
• Retail overconcentration in single-stock leveraged ETFs on Samsung and SK hynix is a worrying risk.
• KOSDAQ's ETF structure forces indiscriminate selling, making the index vulnerable; selective stock picking in KOSDAQ is preferred.
• The speaker uses past experience of missing a massive smokestack rally to emphasize holding semiconductor leaders through the cycle.