RIA Ideas - A Cheaper way to play AI
Growth Note — EWY
Korea's market is up 200% in a year. Why does it still trade at a fraction of the S&P's multiple?
EWY returned +213.8% over the last 12 months — one of the best-performing equity markets in the world (Yahoo Finance, May 12, 2026). Samsung and SK Hynix supply most of the high-bandwidth memory (HBM) inside every Nvidia AI accelerator, and 2026 output is reportedly fully sold out. Earnings kept pace — KOSPI forward estimates were revised up +102% in six months, the strongest upgrade cycle of any major market worldwide (Deutsche Bank CIO, April 14, 2026).
Despite the run, Korea still trades at ~8x NTM P/E — a 61% discount to the S&P 500’s 19.4x — we have written about this at length. At the company level it’s starker: Samsung at 5.5x forward earnings, SK Hynix at 4.9x — vs Nvidia at 19.2x. Same AI supply chain, very different multiples. A second tailwind: Korea’s multi-year governance reform program — dividend tax reform, mandatory treasury-share cancellation, stronger shareholder rights — is designed to further close that gap.
AI Supply Chain Forward P/E · EWY 1-Year Return vs Global Benchmarks
Data: Yahoo Finance via yfinance & Deutsche Bank CIO, as of May 12, 2026 · marinelayeradvisors.com/insights
Ways To Express A Constructive View
3-Year EWY Snowball
~26% P.A.
Annual call at 100% of initial value · 70% principal barrier · If EWY closes at or above its starting level on any annual date, the note calls and pays all accrued coupons.
3-Year EWY / EEM Worst-of Growth Note
~170% Upside Participation
70% principal barrier · Point-to-point at maturity · EWY makes up ~15% of EEM and the two are 0.81 correlated — a natural pair expressing Korea’s AI story from two angles, with 1.7x amplified upside.
Indicative levels
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This material is for informational purposes only and does not constitute a recommendation. Data sourced from Yahoo Finance, Deutsche Bank Chief Investment Office (April 14, 2026), and public sources; data has not been independently verified. Past performance is not indicative of future results. Structured notes involve risks including potential loss of principal. International investments involve additional risks including currency fluctuation, political instability, and differences in financial reporting standards. Structured note pricing is subject to issuer credit risk, market conditions, and availability at time of execution.
