Korean semiconductor exchange-traded funds (ETFs) have posted solid gains on the back of rising share prices of Samsung Electronics (005930.KS) and SK hynix (000660.KS), but small and mid-sized asset managers that differentiated their third- and lower-ranked holdings have significantly outperformed products from major asset managers in both returns and fund inflows.
According to the Korea Exchange on Tuesday, Shinhan Asset Management's "SOL AI Semiconductor TOP2 Plus" posted a one-month return of 26.9% as of the day. Retail investors have net-purchased 352.1 billion won ($258 million) of SOL AI Semiconductor TOP2 Plus since its listing on the 17th of last month through Tuesday, with net purchases over the past week alone reaching 139.2 billion won. This indicates that the pace of fund inflows is accelerating.
By contrast, Mirae Asset Global Investments' "TIGER Semiconductor TOP10," the largest domestic semiconductor ETF by net assets, posted a one-month return of 9.47%, less than half of SOL AI Semiconductor TOP2 Plus. Retail investors have net-sold 55.1 billion won of TIGER Semiconductor TOP10 this month, exiting their holdings.
The decisive factor in the performance gap between SOL AI Semiconductor TOP2 Plus and TIGER Semiconductor TOP10 was the third-largest holding in their portfolios. While the combined weightings of Samsung Electronics and SK hynix in the two ETFs were similar at 46.48% and 53.15%, respectively, SOL AI Semiconductor TOP2 Plus held Samsung Electro-Mechanics (009150.KS) at 18.89%, whereas TIGER Semiconductor TOP10 held Hanmi Semiconductor (042700.KS) at 15.81%.
Other semiconductor ETFs show similar patterns. "HANARO Fn K-Semiconductor," which ranked second in one-month returns at 22.98% after SOL AI Semiconductor TOP2 Plus, had a higher weighting of Samsung Electro-Mechanics (23.55%) than Hanmi Semiconductor (6.92%). "KODEX Semiconductor," the second-largest semiconductor ETF by net assets, which included Hanmi Semiconductor as its third-largest holding (8.99%), posted a one-month return of just 12.61%.
Samsung Electro-Mechanics shares have surged 89.3% this month alone, significantly exceeding their levels before the outbreak of the Iran war. The structural increase in demand for multi-layer ceramic capacitors (MLCC) has emerged as a driver of medium- to long-term earnings growth. Daishin Securities raised its target price for Samsung Electro-Mechanics to 920,000 won on Tuesday, saying, "Earnings surprises are estimated to begin from the second quarter of this year, enabling further share price gains."
Hanmi Semiconductor, on the other hand, faces concerns over overvaluation. The stock, which hit a record high of 333,500 won on the 6th of last month, closed at 293,500 won on Tuesday. With a price-to-earnings ratio (PER) of 131 times based on last year's earnings, the key question is whether the company can deliver earnings growth sufficient to justify its valuation. Korean brokerages have not issued a single stock report on Hanmi Semiconductor since the end of January this year.
"The details of each semiconductor ETF are different, and the resulting performance also diverges sharply," an asset management company official said. "Investors need to look at whether semiconductor materials, parts, and equipment companies with high growth potential are included in the portfolio."
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