Will Government Take Further Action?
The government continues to implement its “Three-Year Plan for Economic Innovation,” which includes expansionary monetary and fiscal policies, structural labor market reforms, enhancements to industrial capacity and other pro-growth initiatives. We are constructive on all of these policies and believe that, if successful, they will be supportive for equity prices, but we think more could be done, and the key question is, will the government do more to protect the country’s global market share? We think the higher dividend payments, a relatively low starting valuation, coupled with the central bank’s action toward stimulating the economy may provide for an attractive combination of prospective returns to South Korea’s stocks.
Read our market insight South Korea at a Crossroads.
View current holding of the WisdomTree Korea Hedged Equity Index here.
1Earnings Conference Call, Samsung, 1/28/15.
2Earnings Conference Call, Hyundai Motor, 1/22/15.
Important Risks Related to this Article
Investments focused in South Korea increase the impact of events and developments associated with the region, which can adversely affect performance.
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