China-Korea Semiconductor ETF has increased over 67% this year! Has issued 49 risk alerts and 17 temporary suspension notices

On February 26, the Korean stock market hit a new high. At the close, the Korea Composite Stock Price Index rose 3.67% to 6,307.32 points, with an intraday high of 6,313.27 points, setting a new record. Since the beginning of the year, it has increased by 49.67%.

As the leading stocks, South Korea’s two major chip giants, Samsung Electronics and SK Hynix, also surged, rising over 7% on the 26th and reaching new highs.

The Korea-China Semiconductor ETF (513310), which tracks the Korean market and is one of the few such ETFs, also includes these two flagship companies, Samsung Electronics and SK Hynix. On the 26th, the ETF surged by 9.64% with high trading volume, closing at 4.321 yuan, a premium rate of 20.98%, with a trading volume of 8.7 billion yuan.

It is worth noting that since October last year, the fund has issued risk warnings due to high premiums. Since February 2026, these warnings have become more frequent, almost twice daily, including secondary market trading price premium risk notices and temporary suspension announcements. Despite this, investor enthusiasm remains strong.

49 risk warnings and 17 temporary suspension notices fail to dampen investor enthusiasm

Public information shows that the China-Hong Kong Semiconductor ETF managed by Huatai-PineBridge was established on November 2, 2022. The fund managers are Liu Jun and Li Muyang. According to the Q4 2025 quarterly report, the top ten holdings include Samsung Electronics, SK Hynix, Cambrian, SMIC, Hygon Information, North Huachuang, Zhaoyi Innovation, Lankes Technology, Microchip, and Powertech. As the stock prices of Samsung Electronics and SK Hynix soared in 2026, the ETF has gained 67.68% this year, reaching a new intraday high of 4.33 yuan on February 26.

According to statistics from China Securities Journal, this fund has issued 49 risk warnings and 17 temporary suspension notices this year due to high premiums.

Selected risk warnings and suspension notices:

On February 26, Huatai-PineBridge reiterated that the secondary market trading price of the China-Hong Kong Semiconductor ETF was significantly higher than its net asset value, with a large premium. Investors are warned to be cautious of the risks of trading premiums. Blind investment could lead to significant losses. The fund also stated that if the premium does not effectively decrease, it reserves the right to request temporary intraday suspension or extended suspension from the Shanghai Stock Exchange to alert the market. Investors should be aware of the risks of investing in high-premium fund shares.

The quarterly report states that during the reporting period, the Korea Composite Index hit new highs mainly driven by a super cycle in storage and a surge in AI server demand. Prices for DRAM memory and HBM3E increased year-over-year, with contract prices rising sharply. The profitability of leading Korean semiconductor companies may improve significantly. Looking ahead to 2026, the storage cycle may still be ongoing, and sustained high AI demand could continue to boost profits for Korean industry leaders. Domestically, Chinese storage manufacturers are advancing IPOs, which may support capacity expansion and resonate with industry cycles.

Fund managers focusing on the Korean market noted that the market was led by semiconductor giants like Samsung Electronics, highlighting the close link between stock market performance and the global tech industry cycle. Driven by rising tech chip stocks, improved macroeconomic expectations, and high market sentiment, ETFs tracking the Korean stock market have also surged.

Korean stock market hits new highs, storage chips enter super cycle

As the Korean stock market continues to reach new highs, nearly 50% gains this year lead globally. According to Bank of America, as of mid-February 2026, Korean stock funds have attracted foreign investment for six consecutive weeks, totaling $17.7 billion, setting a record. Analysts attribute this to the ongoing explosion in global AI computing power demand, which is pushing storage chips into a seller’s market. Korea, as a major exporter of semiconductors, is directly benefiting.

Data from Korea Customs Service released on February 23 shows that from February 1 to 20, Korea’s exports reached $43.5 billion, a record high for the period. Semiconductors were the main driver, with exports of $15.115 billion, up 134.1% year-over-year. Semiconductors accounted for 34.7% of total exports, an increase of 16.4 percentage points from the previous year.

Since the beginning of 2026, SK Hynix’s stock price has risen nearly 80%, reaching a new high of 1,099,000 won (about 5,275.2 RMB) on February 26. During a recent virtual investor conference, SK Hynix revealed that the storage market has fully entered a seller’s market. Driven by real AI demand and limited cleanroom space, storage prices are expected to continue rising this year. The company disclosed that current DRAM and NAND inventories are only about four weeks’ worth, with no customer fully meeting demand. As 2026 HBM capacity runs out, the severe shortage of standard DRAM is significantly increasing suppliers’ bargaining power, and long-term contracts are being negotiated to secure future supply.

Market research firm TrendForce announced on Thursday that Samsung Electronics regained the global DRAM market leadership in Q4 2025, with DRAM sales reaching $19.3 billion, up 43% quarter-over-quarter, with a market share of 36%. Recent reports also suggest Samsung may supply the sixth-generation HBM4 exclusively for Nvidia’s high-end products. Driven by these positive developments, Samsung’s stock has surged 81.82% this year, reaching a record high of 219,000 won (about 1,051.2 RMB) on February 26.

Morgan Stanley analysts believe that Samsung’s path to a trillion-dollar market cap will be driven by stronger profitability, expanding margins, and sustained pricing power in memory. Macquarie has set a target price of 340,000 won, expecting Samsung’s net profit to increase tenfold from 2025 to 2028, supported by the storage business.

The continuous rise in Samsung Electronics and SK Hynix stock prices directly reflects the AI-driven storage chip “super cycle” in the capital markets. This is driven by the global AI computing infrastructure boom and ongoing tight supply of storage chips.

Ping An Securities’ electronics team pointed out that the industry is at a critical upgrade node, with overseas CSPs increasing AI infrastructure investments. The expansion of AI training and inference scales is leading to higher shipment volumes. Additionally, the rising proportion of high-tech products like HBM and enterprise SSDs is raising average selling prices. Given the current high AI activity, the strength and longevity of this storage cycle are expected to surpass the previous one.

Goldman Sachs analysts predict that the new demand cycle driven by AI will continue until 2027, supporting profit growth for related companies.

Homin Lee, senior macro strategist at Lombard Odier, said: “Korea continues to benefit from multiple structural tailwinds. The positive spillover effects of the storage super cycle are increasingly spreading across the broader tech ecosystem.”