“We have an underweight allocation to Taiwan given more attractive opportunities in Korea,” said James Cook, head of investment specialists at Federated Hermes. The asset manager’s biggest stock position is in Samsung as it’s “priced only on its non-AI business which is mid-to-low cycle, and at a record discount to TSMC.”
Investors searching for ways to navigate into the artificial intelligence story are turning their sights away from Taiwan and toward South Korea.
Federated Hermes, M&G Investments and Invesco Asset Management are underweight Taiwanese stocks and overweight Korean shares, saying positioning in the former has become crowded after a record-breaking rally. A push from Samsung Electronics Co. and SK Hynix Inc. into high-bandwidth memory, cheaper valuations and outsized gains from Taiwan Semiconductor Manufacturing Co. are making Korean shares a more appealing bet.
