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Beware the boom and bust cycle of memory stocks, investors warn amid AI boom
- Memory stocks face ongoing volatility despite recent gains, with investors split on whether cycles have truly ended.
- Samsung Electronics and SK Hynix dominate Korea’s Kospi, composing over half of the index, amplifying any swings.
- Analysts project potential price targets for SK Hynix and Samsung in the coming year, signaling optimism with caution.
- AI-driven demand and new memory-saving tech could alter long-term demand, but whether a structural shift has occurred remains debated.
- Industry executives warn that the memory market could revert to boom-and-bust patterns if AI demand cools and supply constraints ease.
- Alphabet's TurboQuant aims to reduce memory needs for large AI models, potentially easing demand pressure on chip suppliers.
- Deutsche Bank notes ongoing AI disruption, emphasizing that demand shifts are not guaranteed to persist in favor of memory chips.
- Industry figures warn that despite near-term supply constraints, production could grow over three years if AI demand normalizes.
- Market observers stress South Korea's exposure to memory names and advise diversification to manage risk.
- Analysts warn that while short-term momentum supports gains, long-term returns may rely on disciplined investments and demand stability.
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