Bae Jae-gyu, head of Korea Investment Management, said on the 30th that single-stock leverage products for Samsung Electronics and SK hynix should be "allowed to die naturally, not delisted."
Bae said on social media (SNS) that "single-stock leverage ETFs should be allowed to die naturally, not be delisted," adding, "This is not something we should ask only of investors. With asset managers, liquidity providers (LPs), and a bit of help from the system, a natural end is possible."
He warned against directional bets using single-stock leverage. He added, "Many people think, 'It's fallen a lot, so it should rise now,' or 'I'll get in briefly and get out quickly,' but how many times have we really nailed that timing? You might make revenue once or twice, but it's hard to become rich consistently that way."
Bae stressed that the more volatile the market, the more important it is to stick to investment principles. He said, "When the market is as unsettled as it is now, you need to revisit your own investment principles," adding, "If the competitiveness of corporations and the growth potential of the industry are not damaged, there is no need to be overly swayed by day-to-day price moves."
He maintained a positive view on the semiconductor cycle but advised that investors should diversify across the entire industry ecosystem rather than concentrate on specific stocks. He argued, "In the age of artificial intelligence (AI), semiconductors are essential and not easily replaced," while adding, "Memory is still a cyclical business. So we need to keep watching it."
He went on, "Even if one part of the industry wobbles, you can capture the growth of the whole ecosystem together, so you should invest in design, memory, foundry, and equipment together."