Hedge funds are targeting South Korea’s chipmakers, betting on the surge in demand for high-end memory chips and government investment. Major players like Man Group, FengHe Fund Management, CloudAlpha Capital Management, and East Eagle Asset Management are focusing on giants like SK Hynix and Samsung Electronics.
“If Nvidia is the king of the AI story, then Hynix is the queen,” said Matt Hu, CIO of FengHe, which has been investing in Hynix and Samsung this year. While Nvidia’s value soared to over $3 trillion, stocks like Hynix have lagged. However, attention is shifting to South Korean chipmakers as they supply crucial high-bandwidth memory (HBM) chips for generative AI technology.
Hynix, a top HBM supplier to Nvidia, benefits significantly from this relationship. The South Korean government’s 26 trillion won ($19 billion) support package for the chip industry has also bolstered confidence. This hedge fund activity helped the KOSPI index achieve its best month in seven months in June, with South Korean stocks attracting their largest inflows since 2008.