South Korea doesn’t get the headlines that Japan or China attract, but if you’ve been watching markets this year, the numbers are wild.
The KOSPI — Korea’s benchmark index — surged more than 30% in April and has continued higher in May to hit new all-time highs as Samsung, one of the index’s heavyweights, went through the $1trillion market club joining the exclusive club that is now thirteen stocks strong and maybe not so exclusive.
Source: Bloomberg
Behind the rally are two stories running at once.
Story one: The AI memory play
Korea is where most AI chips get their memory. Samsung Electronics and SK Hynix together dominate the global DRAM and high-bandwidth memory (HBM) market, the specialist chips that let AI systems run at speed. Every time Nvidia ships a GPU, there’s a good chance Korean-made memory is inside it.
This isn’t a new development, but the AI buildout is still accelerating, and memory demand is rising with it. Semiconductor ETFs on the Korean market were among the top performers in Q1 2026, with Samsung and SK Hynix leading returns.
EWY (iShares MSCI South Korea ETF)
Story two: Fixing the Korea discount
Korean companies have long traded at cheaper valuations than comparable businesses in the US, Europe or even Japan. The reasons are well-documented: dominant family-controlled conglomerates, complex cross-shareholdings, and historically poor treatment of minority shareholders.
In 2024, the Korean government launched its Corporate Value-Up Programme, a direct attempt to address this, modelled loosely on Japan’s market reform push. The idea is to incentivise companies to raise ROE, improve payouts and disclose plans to boost valuations.
By the end of 2025, 174 companies had published Value-Up plans. In December 2025, the National Assembly cut dividend taxes from as high as 45% to between 14% and 30%, making payouts considerably more attractive. The Korea Value-Up Index is up more than 130% since its launch in September 2024.
The market is taking the reform seriously but whether it sticks remains to be seen.
How to buy into South Korea?
The most liquid option is EWY (iShares MSCI South Korea ETF), listed on NYSE. It has ±$21 billion in assets and a TER of 0.59%. BUT, almost 45% of the fund sits in two stocks; SK Hynix at 22.5% and Samsung Electronics at 22.6%. You’re buying a Korea ETF, but you’re mostly buying a memory chip ETF. That’s not necessarily bad given the AI thesis, but it’s a concentration of note.
But for South African investors you potentially already hold some South Korea in your portfolio, depending which global ETFs you hold.
| ETF | Exchange | ETF name | South Korea weight | TER/TIC |
|---|---|---|---|---|
| EWY | NYSE | iShares MSCI South Korea ETF | 100% | 0.59% |
| STXACW | JSE | Satrix MSCI ACWI Feeder ETF (developed + EM) | ±1.5% | 0.35% |
| GLOBAL* | JSE | 10X Total World Stock Feeder ETF (via VT) | ±1.9% | 0.29% |
| STXEMG | JSE | Satrix MSCI Emerging Markets Feeder ETF | ±19% | 0.40% |
| FNBEMG* | JSE | FNB MSCI EM Feeder ETF | ±19% | 0.33% |
| ETFEMA | JSE | 1nvest MSCI EM Asia Index Feeder ETF | ±23.6% | 0.41% |
| SYGEMF | JSE | Sygnia Itrix MSCI Emerging Markets 50 ETF | ±24.5% | 0.49% |
| STXEME | JSE | Satrix MSCI EM ESG Enhanced Feeder ETF | ±19.5% | 0.38% |
| FNBEQF* | JSE | FNB Global 1200 Equity Fund of Funds ETF | ±1.6% | 0.42% |
This is why I love global diverse ETFs. Who knew South Korea would blow up into a great investment. I didn’t, but when it did, turns out I already held some of it.
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ETF blog
At Just One Lap, we are big fans of passive investment using ETFs. In this weekly blog, we discuss ETFs on the local market and the factors you need to consider when choosing an ETF. If you have wondered how one ETF differs from another, this is where you can find out. We explain which index each ETF tracks, what type of portfolio could benefit from holding each ETF, and how the costs will affect your bottom line.
