2025 First Half Investment Outlook: Why the US Over Korea?

Until late last year, I was someone who proclaimed "Korea is better than the US." At the 2024 Chosun Ilbo Finance Show, I warned about Trump risks and recommended undervalued Korea and gold. But now my position has changed. For the first half of 2025, the US looks better than Korea.

🔄 Why Did I Change My Position?

Everyone, the world has changed.

During Trump's first term in 2018, things were really tough. From that experience, I thought "If you invest thinking that person is normal, you're in trouble." So last year, I warned to be cautious about the US market if Trump won.

But looking at the data now, it appears the US has entered a full-blown bubble phase. And bubbles can actually be profit opportunities until they burst.

🏢 Data Center Investment Explosion

The most noticeable change is in investment patterns.

• Red/Yellow lines: Data center investment → Surging
• Blue line: Office building investment → Declining

Investment in spaces for people is decreasing, but investment in spaces for computers is exploding.

What does this mean?

1. Demand for AI infrastructure actually exists
2. Big Tech is actually spending money
3. These investments could translate into future earnings

This isn't just a theme—it's evidence that real capital is moving.

📈 Characteristics of the US Bubble

Just because it's a bubble doesn't mean you should avoid it entirely. Bubbles have several characteristics:

1. Backed by real technological progress - AI, cloud, data centers
2. Earnings are following - Profit growth from Big Tech companies
3. Abundant liquidity - Rate cut expectations
4. FOMO is in play - Fear Of Missing Out

In such conditions, bubbles can last longer than expected.

🇰🇷 Why Is Korea Still Challenging?

Meanwhile, Korea:

• Structural undervaluation (Korea Discount) hasn't been resolved
• Payout ratio still at 26%, shareholder returns remain insufficient
• Internal ownership at 62%, low probability of governance improvement
• Activist funds showing no results

It's true that PBR at 1.2-1.4x is undervalued, but there's no visible catalyst for this to resolve.

🌍 Asset Allocation Strategy Suggestions

So what should you do?

2025 First Half Portfolio Direction

Asset	Weight Direction	Reason
US Stocks	Increase	Benefit from bubble phase
Korean Stocks	Maintain/Reduce	Structural problems persist
Gold	Maintain	Uncertainty hedge
Bonds	Selective	Interest rate direction unclear

Cautions

1. No going all-in - Bubbles can burst anytime
2. Diversification is essential - Korea/US/Developed/Emerging/Bonds/Gold
3. Rebalancing - Adjust weights regularly

💡 What About Trump Risk?

Trump remains unpredictable. However:

• The market has already "priced in" Trump
• Earnings momentum is stronger than initial policy uncertainty
• Tax cuts and deregulation expectations are supporting the market

The risk hasn't disappeared, but short-term upward momentum appears stronger.

🎯 Conclusion

2025 First Half Key Messages:

1. ✅ Consider increasing US weight over Korea
2. ✅ Pay attention to increasing data center/AI-related investments
3. ✅ Even in a bubble, there are profit opportunities before it bursts
4. ✅ But absolutely no going all-in
5. ✅ Will need reassessment in the second half

The most important thing in investing is flexibility. It's not embarrassing to switch from advocating Korea last year to the US this year. When data changes, opinions should change too.

I hope you respond flexibly to market conditions as well.