The investment signal to buy the iShares MSCI South Korea ETF (EWY) stems from the belief that the South Korean market, particularly driven by major players like Samsung and SK Hynex, is poised for significant growth due to tightening memory supply and increasing pricing power. Charan.invests revealed that he purchased $10,000 worth of call options on EWY, achieving over a 20% gain in just one day, indicating a strong bullish sentiment. He highlighted that SK Hynex is trading at a forward price-to-earnings (PE) ratio under 5, suggesting it is undervalued as the market perceives the current memory cycle as temporary. However, he argues that if AI demand continues to rise, memory could become a structural bottleneck, leading to sustained high earnings and a revaluation of low multiples. Additionally, he noted that EWY is breaking into a breakout zone while other stocks are facing selling pressure, and he believes that employee volatility is not fully priced in for EWY's potential upward movement. For investors tracking charan.invests, this implies a short-term bullish outlook on EWY, with the potential for further gains as institutional money flows into South Korean equities.
I just bought $10,000 worth of calls on EWY, and I'm already up over 20% in one day.