SK Hynix ADR Shows 16-51% Premium Over Korean Shares in Two Weeks on U.S. Market

SK Hynix-8.33%
SKHY-8.74%
SKHYV-0.98%
TSM-2.86%
According to The Wall Street Journal, SK Hynix ADRs listed in the U.S. this month have shown a significant premium relative to its Seoul-listed shares, with the gap ranging from 16% to 51% since launch and standing at 29% on Friday, July 26. Each ADR represents 0.1 Seoul-listed shares and is convertible to Korean stock, but regulatory constraints prevent reverse conversion without company approval, eliminating arbitrage opportunities. This premium reflects strong U.S. investor demand for AI chip and memory stocks, as American investors prefer direct NYSE trading over using brokers for Korean shares. For comparison, TSMC ADRs averaged only a 3.2% premium from 2010-2020, but have averaged 15% since ChatGPT's launch in 2022.
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