You watched it double, then give all of it back in three weeks. $52.82 on 22 May, $80.72 on 22 June, $52.72 on 17 July. Not many explained why, This is my take. Here's What happened to $DRAM - DRAM is roughly 74% three stocks: Micron, Samsung and SK Hynix. About half the fund is South Korean. That means Korean margin calls are American portfolio events. - Korea listed 16 single-stock leveraged ETFs on Samsung and SK Hynix in late May. 92% retail-held. Margin debt hit a record ₩38.63 Trillion. (~$26.6 billion) - On 22 June, the day DRAM peaked, Korea's regulator said publicly he regretted approving these leveraged ETFs. The next day the KOSPI fell nearly 10%. - Three more major sellers followed, triggering an avalanche: 1. The national pension fund resumed rebalancing on 1 July, 2. Foreign institutions sold ₩7.76tn on 29 June alone (Concentration limits, Memory became too big) 3. Brokers began closing retail accounts at ten times the January rate. (Margin calls) - SK Hynix issued $28bn of new stock, the same week memory bottomed. - Meanwhile Micron reported revenue up 346% and 85% gross margins on 24 June. SK Hynix, Samsung and TSMC all beat and guided higher. —— Happened Today: The group is bouncing. MU and SKHY both trending up and DRAM back above $54 after hours. No new fundamental catalyst, this is a technical recovery after the Philadelphia Semiconductor Index lost more than 9% last week. The RSI crossed back above 40 on the daily timeframe. Forced selling appears to have exhausted itself for now. Whether this becomes a recovery or a dead cat bounce gets answered by upcoming earnings starting with Western Digital on 29 July and hyperscaler capex commentary in the weeks ahead. Happened Last Week: The main piece of good news from last week is that the Korean margin debt has fallen from ₩38.63T ($26.6 billion) at peak to ₩27.40T as of July 13 a 29% decline in under three weeks. Seoul Economic Daily also reported on July 16 that the supply-demand environment was improving with foreigners beginning to return. —— What's next ? If that trajectory continues through this week it would suggest the forced selling that drove the mechanical collapse is largely slowing down and maybe even fully behind us. Next thing to watch are forward estimates. They've been rising the whole way down. If they turn this becomes an entirely different and much bigger problem. Next Post On Thursday $SPCX stay tuned. Educational content, not financial advice Disclaimer: I own $DRAM at $39 avg.
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