Secondary battery ‘rapid charging’ while semiconductors are slowing down... Top related ETF returns

Includes 6 of the top 10 increase rates this month... As demand for ESS increases, related companies perform well

With the strength of KOSDAQ, leveraged ETFs are also ‘growing’… “Is it too high?” Ants are betting on the decline

(Seoul = Yonhap News) Reporter Go Eun-ji = While large-cap semiconductor stocks were stagnant, secondary battery stocks made a surprising leap forward, and exchange-traded funds (ETFs) containing these stocks ranked among the top ETF returns this month.

Amid the recent strong KOSDAQ trend, related leveraged ETFs also showed a steep rise. However, individual investors purchased inverse products that generate profits when the index falls.

According to the Korea Exchange and KOSCOM CHECK on the 9th, 8 of the top 10 ETF returns listed in Korea from the 1st to the 8th were secondary battery-related products.

'KODEX secondary battery industry leverage' recorded the highest increase at 19.94%, followed by 'TIGER secondary battery TOP 10 leverage' at 18.45%.

'SOL all-solid-state battery & silicon anode material' (13.48%) and 'KODEX all-solid-state battery ESS TOP2 Plus' (13.44%) ranked 3rd and 4th, respectively. All-solid-state batteries are batteries in which the electrolyte inside the battery has been changed from liquid to solid, and are expected to be commercialized next year.

In addition, 'BNK secondary battery anode material' (6th place, 11.22%), 'KODEX secondary battery industry' (8th place, 10.68%), 'SOL secondary battery manager fn' (9th place, 10.47%), and 'TIGER secondary battery material fn' (10th place, 10.26%) ETFs were included in the top 10 in terms of increase.

The strong performance of the secondary battery ETF is interpreted as the result of the benefits of energy storage systems (ESS) resulting from the expansion of artificial intelligence (AI) data centers being reflected in the performance of related companies.

LG Energy Solutions [373220], a leading company, announced on the 8th that its consolidated operating profit in the third quarter of this year was provisionally calculated at KRW 756 billion, a 25.7% increase from the same period last year. Operating profit increased by 567.3% compared to the previous quarter, achieving the highest quarterly sales.

The 'KRX K-AI secondary battery index' rose 10.79% this month, recording the highest increase rate among the Korea Exchange theme indices. This is more than twice the increase rate of the ‘KRX AI Semiconductor Index’ (4.88%).

Kim Gwi-yeon, a researcher at Daishin Securities, maintained his investment opinion of 'overweight' on the secondary battery industry, saying, "Following the order momentum (driving force) at the end of this year, the stock price momentum due to improvement in ESS sales and profitability next year is valid."

Nam Yong-soo, head of ETF division at Korea Investment Trust Management, said, “The recent increase in the returns of secondary battery ETFs can be interpreted as the connection between ESS and AI data centers has raised expectations for growth,” and added, “We expect the ESS-centered recovery to continue in the future, but as stock prices are moving from growth expectations to the profit verification stage, ESS supply contracts and mass production capabilities need to be confirmed.”

Due to the strong performance of the KOSDAQ index this month, the increase in the KOSDAQ leveraged ETF was also large.

From the 1st to the 8th, KOSDAQ rose 4.25%. On the other hand, KOSPI fell 3.10%.

Accordingly, 'TIGER KOSDAQ 150 Leverage' (9.92%), 'KODEX KOSDAQ 150 Leverage' (9.66%), 'RISE KOSDAQ 150 Futures Leverage' (9.51%), and 'HANARO KOSDAQ 150 Futures Leverage' (9.38%) showed an increase rate close to 10%.

Ji-young Han, a researcher at Kiwoom Securities, said, “With the bottom end of large-cap stocks such as semiconductors supported, a supply/demand rotation toward KOSDAQ mid- and small-cap stocks took place,” and added, “The semiconductor materials/parts (materials, components, equipment), secondary battery, and bio industries in the KOSDAQ showed strength.”

However, this month, ants showed a trend of betting on a decline in the KOSDAQ.

In October, individual investors net sold 'TIGER KOSDAQ 150 Leverage' worth 4.6 billion won, while 'TIGER KOSDAQ 150 Futures Inverse' net bought 180 million won.

Likewise, 'KODEX KOSDAQ 150 Leverage' was a net seller of 116.3 billion won, and 'KODEX KOSDAQ 150 Futures Inverse' was a net purchase of 1.7 billion won.