Invest1 publisher3 min readPublished
Korean retail money quit the 3x chip trade: $4.42B in July, $106M so far in August
Net buying of SOXL and the SK hynix ADR nearly equalled all Korean purchases of US stocks in July. Thirteen days into August, both names sit outside the top 20.
The Investor · Invest desk
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What happened
- In July, Korean retail net buying of SOXL, an ETF tracking three times the daily return of the Philadelphia Semiconductor Index, was $3.58 billion, the runaway leader.
- The US-listed SK hynix depositary receipt ranked second in July net buying at $843.71 million.
- Net buying of SOXL and the SK hynix ADR together totalled $4.42 billion in July.
- This month, SOXL fell to 24th in net buying at $52.57 million.
- This month, the SK hynix ADR fell to 23rd in net buying at $53.42 million.
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Why it matters
Korean retail investors put $4.42 billion of net buying into two instruments in July: SOXL, the ETF tracking three times the daily move of the Philadelphia Semiconductor Index, at $3.58 billion, and the US-listed SK hynix depositary receipt at $843.71 million [1][2][3]. In the first 13 days of August, according to Seibro, the Korea Securities Depository's information portal, SOXL netted $52.57 million and the SK hynix ADR $53.42 million, ranking 24th and 23rd [4][5][6]. That is roughly 2 percent of the prior month's figure for the same pair [7].
The July number matters because of what it crowded out. Total Korean net buying settlement value in US stocks that month was $4.64 billion, so those two names accounted for about 95 percent of it, leaving something like $220 million spread across everything else [8][9][10]. Amazon, Micron and SanDisk did not make the top 50 [11].
August inverted that. Amazon led net buying at $193.61 million, SpaceX was second at $175.92 million and Alphabet third at $136.30 million, with Bloom Energy fifth at $114.87 million and Tesla sixth at $109.14 million [12][13][14][15][16]. SanDisk entered ninth at $100.53 million and Micron 12th at $91.37 million [17][18]. Six of the top ten were individual stocks [19]. The eight disclosed figures total about $1.05 billion over 13 days [20], against $4.42 billion concentrated in two tickers over the whole of July [3]. On a per-calendar-day basis, SOXL alone was absorbing about $115 million a day in July versus Amazon's roughly $15 million a day this month [21].
The trigger was ordinary. Big Tech cloud earnings beat expectations and technology stocks rebounded sharply [22]. On July 30 and 31, local time, Micron rose 18.36 percent, SanDisk 25.99 percent and Amazon 15.32 percent, while the Philadelphia Semiconductor Index gained 8.27 percent across the two sessions [23][24]. Sedaily's read is that investors took the gains embedded in the triple-leveraged product and rotated into single names with confirmed earnings and AI capex exposure [25].
The list also spread down the AI value chain rather than up the leverage curve: optical networking supplier Coherent ranked 11th, Marvell 13th, and Vertiv, which builds data centre power and cooling gear, 16th [26][27]. Sedaily characterises this as splitting holdings across cloud, memory, and power and communications infrastructure instead of betting on the direction of one semiconductor index [28].
De-risking is not the same as risk aversion. ProShares Ultra QQQ, at twice the daily Nasdaq 100 return, ranked fourth at $126.68 million [29], about 12 percent of the disclosed August total [30]. An official in the financial investment industry told Sedaily that risk appetite has not weakened, but that July's concentration in triple-leveraged chip products has eased and the criteria for picking stocks and products have become more granular [31].
Worth watching: whether the flow through the 6th, when Amazon, Micron and SanDisk held the top three spots before buying widened to SpaceX, Alphabet, Bloom Energy and Tesla, marks a durable preference or a lap of the same momentum [32]. Triple-leveraged daily-reset products decay in choppy tape; 2x Nasdaq exposure at $126.68 million says the appetite simply moved one notch down [29].