37-Year Breakout In The SoKo Trade – not Southern Comfort, it’s South Korea 🇰🇷

Hey everyone,

Quick housekeeping joke before we dive in: when I say I’m all-in on “the SoKo trade,” I’m not talking about Southern Comfort. I’m talking about South Korea. (I’m a chart guy, not a bartender — though after some weeks in this market, I understand the appeal of both.)

Here’s the big idea: the AI trade may be filing a change-of-address form, forwarding its mail from Silicon Valley to “Seoul-icon Valley.”

Last week I went on CNBC to make exactly this case — the rotation of global capital into South Korea and emerging-market AI. If you missed it, the interview is up on our site here:

Let me show you the charts that have me this fired up.

The 37-Year Breakout

This first chart is the quarterly KOSPI / S&P 500 ratio — basically a head-to-head scorecard of Korean stocks versus U.S. stocks. When the line falls, the U.S. is winning. When it rises, Korea is.

Look at that downtrend line. It’s held since the late 1980s — back when Reagan was still in the White House and I was more concerned with my baseball card collection than ratio charts. That’s 37 years of Korea losing to the U.S.

And right now, for the first time in nearly four decades, that line is breaking. If the ratio can hold above the 1.08 area, the breakout is confirmed and it’s officially game on in Seoul-icon Valley.

Why Korea? Because they own the bottleneck.

Korea sits at the dead center of the global supply chain for HBM (high-bandwidth memory) and DRAM (dynamic random-access memory) — the two chip technologies that make modern AI possible. Stack on a weaker U.S. dollar, an accommodative Bank of Korea, and a record current account surplus, and you’ve got a powerful setup.

Even Goldman Sachs can’t keep up. Per Goldman Sachs Research, the firm just raised its 2026 earnings-growth forecast for Korea to 130% from 120% — and that’s the third upward revision their strategists have made this year. When the smartest analysts on the Street keep having to revise higher, that tells you the demand is outrunning everyone’s imagination.

Here’s the part I really want you to hear, though. This isn’t really a Korean story. It’s an AI infrastructure story. It’s the market finally pricing the AI revolution as if it’s real — and we may still be in the early innings.

The AI buildout isn’t winner-take-all. I think of it as five connected pillars:

1. Compute — the GPUs that do the math
2. Memory — the HBM and DRAM that feed them
3. Networking — the gear that connects everything
4. Power — the gas, nuclear, and renewables that fuel it
5. The grid — the transmission that ties it all together

Wall Street was obsessed with pillar #1 (GPUs) all through 2024. Now, in 2026, capital is rotating into the other four — and crossing international borders to do it. Today we’re zeroing in on the most supply-constrained piece of the entire stack: memory. And that’s exactly where South Korea has its stranglehold.

The watch list, not the buy list

So you might be thinking, “Great, Todd — let me go load up on Korean stocks.” Pump the brakes for a second.

I ran a scan on Koyfin for South Korean companies with the following attributes:

• Trading Region – South Korea

• Market cap > $5 Billion USD

• Revenue growth for next fiscal year expected to be > 20%

• Revenue growth for 2 fiscal years away expected to be > 20%

• EPS growth for next fiscal year expected to be >20%

• EPS growth for 2 fiscal years away expected to be >20%

That’s a demanding screen — and it still returned 9 names, including two you’ll recognize: Samsung and SK Hynix.

The fundamentals are spectacular. But pull up the price charts on these names and you’ll see the same thing across the board: highly extended and overbought. The KOSPI itself is up roughly 95% on the year.

I would not recommend running straight into these names up here. Put them on your hot watch list instead. Remember, the KOSPI has had eight single-day gains of more than 5% this year — but it also had a 12% intraday drop in March during the Iran conflict and has tripped market-halting circuit breakers more than once. Another pullback is almost certainly coming. A tactical investor waits for that pullback, or at least a consolidation, before stepping in. That’s how you define your risk instead of letting the market define it for you.

How we’re actually playing it

The cleanest way I’ve found to gain South Korean memory exposure is the new Roundhill Memory ETF (ticker: DRAM). It launched about 40 days ago, is already up roughly 100%, and has ballooned to over $10 billion in assets — record-shattering inflows for a brand-new fund. Crucially, it’s about 49% South Korea, with Samsung and SK Hynix as its two largest holdings (Micron rounds out the top three).

We identified the pullback to the 20-day moving average — that $45–$47 zone — as a solid entry point. And today, DRAM broke out above its May highs to a fresh all-time high, finishing up 14.56% on the day alone. Part of that was Korea, but a big chunk was Micron ripping roughly 20% on its own.

I keep saying it because it keeps being true: memory isn’t pulling back — it’s crashing higher.

Here’s where it gets actionable for you

We added DRAM to our Fast Money portfolio on Savvy Trader on May 13th — before today’s breakout. If you want to see our active trades in real time, including this one, that’s where to find them:

👉 Savvy Trader portfolio — see every move we make, as we make it.

We have not yet added DRAM to our flagship growth portfolio, Tactical Alpha Growth (TAG) — I want to see the name stabilize first before committing client capital. But that patient, risk-defined approach is exactly how we manage money for our clients every day. If you’d like to talk about whether that fits your situation: https://insideedgecapital.com/investment-management/

👉 [Book a free consultation call with Inside Edge Capital]

Markets change. Leadership rotates. Our job is to spot it early and position you for it — without chasing and without the drama.

Talk soon,

Todd Gordon

Founder,

Inside Edge Capital, LLC

www.InsideEdgeCapital.com

Disclosures: Todd owns EEM personally and for clients. DRAM is currently held in the Inside Edge Capital Fast Money portfolio on Savvy Trader; it is not currently held in the Tactical Alpha Growth (TAG) portfolio. This material is for informational purposes only and is not investment advice or a recommendation to buy or sell any security. Charts from Koyfin and TradingView.

P.S. — Here’s the honest truth: spotting the trade is the easy part. Knowing how much to buy, when to add, and when to walk away — that’s the part that actually protects and grows your money. That’s what we do for clients every single day. If you’d like a no-pressure conversation about your situation, grab a time here.