"Everyone Gets Rich But Me?" Impatient Retail Investors Flock In... Foreign Media Issues Warning

Analyzed as 'Meme Stocks' Alongside SpaceX
"Companies Difficult to Value by Traditional Standards"
"Do Not Jump in Late or Recklessly Resist the Trend"

It has been analyzed that Samsung Electronics and SK hynix have become so-called "meme stocks," attracting a surge of individual investors through online word-of-mouth. There is a growing trend where stock prices are increasingly driven by investment sentiment and derivatives trading, rather than by traditional corporate valuation metrics.

On the 12th (local time), SpaceX employees are celebrating SpaceX's successful debut at the Nasdaq MarketSite in New York, USA. Photo by Yonhap News

Shuli Ren, a columnist for Bloomberg Opinion, presented this analysis in a column published on June 17 (local time) titled "Why Have SpaceX, Samsung, and SK hynix Become Meme Stocks?" She noted that the meme stock craze, which emerged around GameStop and AMC during the COVID-19 pandemic, has now spread to giant technology companies such as Samsung Electronics, SK hynix, and SpaceX.

Ren identified a key commonality among these companies: "It is difficult to assess their traditional valuation." She argued that investors' expectations and sentiment can have a greater impact on stock prices than actual corporate performance.

First, she evaluated SpaceX as a company whose stock price is being driven by expectations for future visions such as "Mars colonization," rather than its current performance. Ren explained, "Fans are willingly paying the 'Musk premium,' hoping for rewards as early Tesla investors once did."

She diagnosed that it is equally difficult to value Samsung Electronics and SK hynix. Because the fair value can fluctuate significantly depending on changes in the semiconductor market, it is challenging to apply standard valuation criteria. In fact, Samsung Electronics' forward price-to-earnings ratio (PER) dropped sharply from 26 times in early 2023 to about 8 times in just a year and a half.

Ren observed that for such stocks, derivatives trading, including options, can have a much greater impact on stock prices. A representative case is the "gamma squeeze," where if there is a surge in options trading, financial firms that sold the options may buy additional shares to hedge their risk, further pushing the stock price higher.

She analyzed that such movements have recently been observed in SpaceX as well. With a limited number of shares available for trading and concentrated options trading, volatility in the stock price has increased.

Ren also noted that a similar trend is occurring in the Korean market. As the number of single-stock leveraged ETFs has increased, derivatives trading has grown, and it is estimated that 60–70% of SK hynix's trading volume is related to derivatives operation processes.

Ren warned that individual investors who do not understand this structure could be exposed to significant volatility. However, she also pointed out that the current meme stock phenomenon should not be viewed in the same light as the past GameStop incident. That is because financial firms such as Morgan Stanley are expressing long-term optimism about SpaceX and the AI semiconductor industry, supporting the market sentiment.

She advised, "You should not jump in just because you see others succeed, but you also should not recklessly fight against the massive flow of liquidity."

This content was produced with the assistance of AI translation services.