UBS Recommends Buying SK Hynix ADR on Nasdaq, Selling Korean-Listed Shares on July 10 Debut

According to Bloomberg on July 7, UBS sales and trading desk recommended clients to buy SK Hynix American Depositary Receipts (ADRs) and short Korean-listed shares ahead of the chipmaker's Nasdaq listing on July 10. UBS expects the newly issued ADRs to trade at a premium, citing better operational efficiency and lower costs compared to Korean shares, alongside potential appeal to global portfolio managers who don't hold Korean equities. The bank stated the discount risk is minimal given limited dollar exposure. As a comparative example, Taiwan Semiconductor Manufacturing Company's ADRs listed on NYSE traded at an average 16% premium to Taiwan-listed shares this month.
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