SK Hynix American Depositary Receipts (ADRs) are trading at a significant premium compared to the company’s shares in Seoul. This price gap recently reached as high as 51%. Most ADRs typically maintain a low single-digit premium. Analysts warn this anomaly signals market overheating reminiscent of the dot-com era.
Surging U.S. investor demand for AI-related assets drives the price disparity. Structural market limitations currently block arbitrage mechanisms from correcting the imbalance. South Korean regulators capped the conversion of local shares into ADRs at 2.5% of the total. This quota reached full capacity during the company's recent record-breaking U.S. IPO.