BlackRock's iShares MSCI South Korea fund just had its biggest single day ever, and one chipmaker is the reason why.
The iShares MSCI South Korea ETF (EWY) pulled in $281 million on February 12, its largest single-day inflow on record. The catalyst wasn’t some macro shift or currency play. It was one company: SK Hynix.
The memory chip giant, which accounts for roughly 23% of EWY’s total holdings, has become the gravitational center of South Korea’s investment thesis. And for global investors who want a piece of the AI semiconductor boom without navigating the complexities of buying shares on the Korea Exchange directly, this BlackRock-managed ETF has become the path of least resistance.
Why SK Hynix is driving the bus #
SK Hynix is the world’s second-largest memory chip manufacturer, and its high-bandwidth memory (HBM) chips have become critical infrastructure for AI training and inference workloads. That positioning has made SK Hynix one of the hottest semiconductor plays globally, and the broader Kospi index has reached record highs partly on the strength of semiconductor optimism.
With SK Hynix representing nearly a quarter of the fund’s weight, buying EWY is essentially a leveraged bet on the chipmaker with some diversification sprinkled on top.
The ADR play changes the game #
SK Hynix made its Nasdaq debut in early July 2026 through American depositary receipts, raising approximately $26.5 billion. That figure made it the largest US IPO ever by a foreign company.
The ADR listing also triggered a wave of derivative products. Multiple ETF issuers launched or began preparing 2x leveraged and inverse single-stock ETFs focused specifically on SK Hynix ADRs.
The February record inflow into EWY likely reflects a period before these ADR-linked products were widely available, when the country ETF was still the most efficient vehicle for US investors to gain SK Hynix exposure.
What this means for investors #
The concentration risk here is real. When one stock represents 23% of an entire country ETF, you’re not really buying geographic diversification. You’re buying a semiconductor stock with extra steps. If SK Hynix stumbles on earnings, faces supply chain disruptions, or sees AI demand cool even slightly, EWY will feel it disproportionately.
The leveraged single-stock ETFs add another layer of complexity. Products offering 2x daily returns on SK Hynix ADRs can generate enormous short-term gains, but they also decay over time due to daily rebalancing mechanics. Holding a 2x leveraged ETF for weeks or months almost never delivers 2x the underlying stock’s return over that period.
The key metric to monitor going forward is HBM chip pricing and order book visibility. SK Hynix’s premium valuation is built on the assumption that AI infrastructure spending will continue accelerating. Any signal that hyperscalers like Microsoft, Google, or Amazon are slowing their data center buildouts could ripple through the entire chain, from SK Hynix’s stock price to EWY’s flows to the leveraged products stacked on top.
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