Samsung, SK Hynix Stock Surge Forces Fund Rebalancing; Foreigners Sell $58.6B in Korean Stocks YTD

According to Bloomberg, on May 29, Samsung Electronics and SK Hynix shares surged, prompting funds to rebalance portfolios after hitting single-stock holding limits. SK Hynix rose over 1,000% in the past year, while Samsung gained more than 400%, with both companies' market values exceeding $1 trillion. Affected institutions including GAM Investment Management and Jupiter Asset Management have begun adjusting holdings to comply with diversification requirements.

Data shows global investors have net sold $58.6 billion in Samsung and SK Hynix stock year-to-date, accounting for most of the $63.6 billion in total Korean stock outflows. Goldman Sachs estimates that since October last year, holding limit restrictions have triggered approximately $69 billion in forced selling.