While stock splits do not directly change a company’s value, they significantly impact market participants. This is largely due to their effect of lowering the price per share, making it accessible to more small-scale investors. What calculations do companies use to decide on stock splits, and how should investors view them? We will delve deeply into the background and impact through recent cases.

Why Do Companies Do Stock Splits?

A stock split is a method companies use to lower the stock price by increasing the number of shares when the price per share is too high, making trading inactive or inaccessible to small investors. For example, if a stock priced at 1 million won per share is split 1-for-10, it becomes 10 shares priced at 100,000 won each. The company’s total market capitalization and the total value of shareholders’ equity do not change.

• Improved Accessibility: High stock prices act as a barrier for small investors. By lowering the price per share through a split, more investors can purchase the stock. KLA’s Chief Financial Officer (CFO), Bren Higgins, directly stated that this stock split is intended to improve the accessibility and liquidity of KLA shares.
• Increased Liquidity: As the number of shares increases, the volume of shares traded in the market itself increases, leading to higher liquidity. This helps reduce the spread between bid and ask prices, allowing investors to trade at more favorable prices.
• Psychological Effect: When the stock price decreases, investors sometimes experience a psychological illusion that the stock appears cheaper. This stimulates buying sentiment, tending to increase trading volume.

What is the Impact on Investors?

A stock split has no impact on a company’s fundamentals. This is because the company’s profits or asset values do not change. However, investors experience several tangible changes. Especially for small investors, it can be a strategy that elicits a ‘better for me’ reaction.

• Expanded Opportunities for Small Investments: Even stocks that were previously high-priced can be invested in with small amounts after a stock split. This expands the investor base and increases public interest in specific companies.
• Activated Trading and Information Dissemination: As liquidity increases, trading in the stock becomes more active, and naturally, its mention in the media and communities also increases. Among Korean companies, Daehan Flour Mills, YC Chem, and POSCO Steelion also carried out stock splits in April 2026, increasing the number of shares held by shareholders. This can lead to increased interest in these companies’ stocks.
• Dividend Adjustment: After a stock split, the dividend per share is generally adjusted according to the split ratio. In KLA’s case, after a 10-for-1 split, the dividend per share is expected to change from $2.30 to $0.23. The total dividend amount remains the same, but shareholders will receive dividends through more shares.

‘Reverse Stock Split’ is Another Story

There is also the opposite concept of a stock split, called a reverse stock split. This is a method of raising the stock price by combining several shares into one. While a stock split aims to lower the stock price to increase accessibility, a reverse stock split is primarily used to meet listing requirements or improve a company’s image. For example, a company whose stock price is too low and facing delisting might artificially raise its stock price.

• Meeting Listing Requirements: Stock exchanges like Nasdaq have minimum price requirements for stocks. If a stock’s price does not meet these requirements, it can be delisted, but a reverse stock split can help avoid this. Recently, Aspire Biopharma announced it would implement a 1-for-30 reverse stock split to meet Nasdaq’s minimum bid price requirement for continued listing.
• Improving Corporate Image: Low-priced stocks, often called penny stocks, can give investors a negative impression. There are also attempts to raise the company’s ‘status’ by increasing the stock price through a reverse stock split.

Stock splits and reverse stock splits may seem like simple adjustments to the number of shares. However, beneath the surface, they are intricately linked to a company’s strategic decisions and market trends. The recent movements of KLA and Korean companies, as well as Aspire Biopharma’s reverse stock split case, clearly demonstrate how these strategies are being utilized in the 2026 stock market. Investors should not merely look at these corporate movements superficially but need a perspective that carefully analyzes their background and potential impact.

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Beyond mere numbers, the Buffett Indicator, which is said to penetrate the essence of the market, is sending an unusual message to the current market. Especially with the news that Warren Buffett himself has increased his cash holdings to an all-time high, investors’ concerns are deepening. From now on, we will coolly analyze the meaning of this indicator and the current situation.

What is the Buffett Indicator? A Market Metric Praised by Warren Buffett

The Buffett Indicator is a metric that shows how overvalued or undervalued a country’s stock market is compared to its real economy. It became famous in 2001 when Warren Buffett mentioned in an interview with the US business magazine Fortune that it “is probably the best single measure of where valuations stand at any given moment.” The calculation method is surprisingly simple.

• Calculation Method: The total market capitalization of a country’s stock market divided by its nominal Gross Domestic Product (GDP), multiplied by 100.
• General Interpretation:
• Below 80%: Stock market undervalued
• 80% to 100%: Stock market fairly valued
• Above 100%: Stock market overvalued

This indicator is useful because it provides an intuitive understanding of whether the stock market is overheated or in a state of fear. It helps to grasp the broad trends of the market from a macroeconomic perspective, beyond just the value of individual companies.

2026: Why Both the US and Korea are Flashing “Unprecedented Overheating” Warnings

As of April 2026, the Buffett Indicator is pointing to an unprecedented level of ‘overvaluation’. The Buffett Indicator for the US stock market recorded 227%, far exceeding the 200% line that Warren Buffett warned about. Buffett, after the dot-com bubble burst, revealed this indicator and stated, “If the number is approaching 200% as it was in 1999 and 2000, you are playing with fire.”

This is a much higher figure compared to the 140-150% range during the dot-com bubble in 2000 and the 100% range before the 2008 global financial crisis. In fact, when the Buffett Indicator reached 200% in 2000 and 2021, the S&P 500 index fell by 50% and 19% respectively. The situation in the domestic stock market is similar. As of April 27, 2026, the total market capitalization of the Korean stock market surpassed 6,000 trillion won for the first time, and the domestic Buffett Indicator also significantly exceeded 200%. With the KOSPI and KOSDAQ setting new records daily, driven by the super-boom in the artificial intelligence (AI) and semiconductor industries, a warning light has been lit, indicating that the market has become excessively expensive compared to the real economy.

Don’t Blindly Trust! Limitations of the Buffett Indicator and Smart Investment Strategies

However, it is not wise to hastily sell all your stocks based solely on the Buffett Indicator. This indicator has clear limitations.

• GDP Lag Problem: The GDP figures used in the Buffett Indicator calculation are from previous quarters, not the current moment.
• Global Company Revenue Not Reflected: Listed companies generate revenue worldwide, but GDP only reflects domestic production. Especially for global companies in the US stock market, the proportion of overseas revenue is large, so comparing it simply with US GDP can lead to overvaluation.
• Liquidity and New Industry Value: It is difficult to overlook that liquidity released in a low-interest rate environment and the future value of new industries like AI are reflected in the stock market.
• Exclusion of Unlisted Companies: GDP includes the revenue of unlisted companies, but market capitalization excludes them, which is also a problem.

Considering these limitations, it is advisable to use the Buffett Indicator as a ‘warning light’ to gauge market overheating. It tells you where the market is on average, but you must remember that it cannot tell you exactly when the market will turn. Ultimately, to fully assess the market, it is important to approach it with a comprehensive perspective, along with other supplementary indicators.

The fact that the Buffett Indicator for both the US and Korean stock markets is at an all-time high is certainly significant. Warren Buffett’s reason for hoarding cash can also be interpreted as a distrust of the risk-reward balance in such a market. Investors should humbly accept the warning this indicator provides and use it as an opportunity to review their own investment principles, rather than being swayed by blind optimism. Now is the time for a wise investment attitude for a ‘good life’.

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It’s hard to keep up with all the news that pours out every day. However, knowing a few key points will greatly help you understand the market. Especially recently, a wide variety of factors, from individual corporate issues to macroeconomic variables and new technology trends, are moving stock prices.

Unpredictable Swings, the Fluctuation of Individual Stock Prices

Looking at the recent market, everyone must have felt that the movements of individual stocks were unusual. Should I call it a rollercoaster? Daehan Kwangtongshin’s stock price repeatedly surged and plummeted, confusing investors. Bit & Electron also touched the upper limit in one day and then showed volatility again, creating a truly ‘bouncing’ market. Such stocks tend to fluctuate greatly depending on short-term issues or supply and demand.

• Daehan Kwangtongshin: Closed up 3.73% on the 17th, but showed sharp fluctuations, soaring to 17,320 won at one point during the day and then returning to the 15,000 won level.
• Bit & Electron: Surged 29.93% after touching the upper limit in the afternoon session on the 17th, but also showed significant volatility.
• Doosan Enerbility: Showed a slight weakness on the 17th, ahead of the weekend, indicating a breather.
• Albemarle: Reached a 52-week high thanks to a rebound in lithium prices, but then plummeted nearly 7% as profit-taking sales poured out.

These examples make us realize once again how difficult it is to predict the market. While aiming for short-term capital gains is good, I think it’s important to always approach such a volatile market cautiously.

Earnings and AI, Powerful Engines Driving Stock Prices

Of course, the fundamentals of individual companies remain one of the biggest factors affecting stock prices. Badger Meter, a US water treatment measurement solutions company, saw its stock price plummet by a whopping 19.68% as its Q1 2026 earnings fell short of market expectations. The slowdown in growth of its core business segment was cited as the main reason for the poor performance. This once again showed that if a company’s earnings fall short of expectations, the stock price reacts mercilessly.

However, AI-related stocks show a completely different picture. Global AI semiconductor company Nvidia’s stock price was strong, bolstered by optimistic forecasts from Wall Street, and Oppenheimer maintained a ‘buy’ rating with a target price of $265. This was based on an analysis highlighting the excellent performance of its next-generation platform. Goldman Sachs even raised its target for the Taiwan stock index, driven by increased AI demand.

This shows how enormous the impact of technology trends on the market is. Especially since AI is going beyond a simple trend and changing the paradigm of entire industries, I think we should continue to pay attention to the stock price movements of related companies in the future.

Investor’s Stance Amidst Volatility: Caution and Long-Term Perspective

While the S&P 500 index recently rallied past the 7100 mark, caution is being raised among experts. Although oil prices plummeted and the stock market surged due to the Strait of Hormuz opening issue, this could be a temporary phenomenon. Wells Fargo Investment Institute’s global equity strategist urged some caution, noting that the market is paying more attention to short-term oil flows.

In such macroeconomic uncertainty, wise judgment by individual investors becomes even more important. The culture of US companies compensating with stock instead of cash bonuses is also noteworthy. This structure encourages employees to focus more on the company’s performance and enhancing corporate value, which seems to send a message that stock investment should be considered from a long-term perspective. Rather than being swayed by short-term ups and downs, it is necessary to invest by looking at the intrinsic value and growth potential of a company.

Ultimately, the stock market is always changing, and predictions are difficult. However, I believe it is really important to read meaningful trends within it and stick to your own investment principles. I hope the content discussed today has been of some help to your investments.

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The Real Reason Why the 2030 Generation is Entering the Stock Market

Inflation is soaring, salaries have been frozen for years or are barely increasing, and the prospect of owning a home feels distant – this is the reality for our 2030 generation. Everyone knows that the era when working hard and saving, like our parents’ generation, could make you rich is long gone. In this situation, the stock market might seem like a last hope. We’re easily swayed by stories of colleagues making money in stocks, and social media is full of success stories, leading to intense FOMO (Fear Of Missing Out) – ‘Is everyone getting rich but me?’ This complex psychology pushes us into the stock market.

• Absolute Necessity for Asset Growth: There’s a strong perception that traditional asset growth methods like real estate and savings can’t keep up with inflation.
• Improved Information Accessibility: With an abundance of stock-related information on YouTube and communities, the barrier to entry feels lower.
• Fear of ‘Becoming a Flash Pauper’: Seeing others’ assets grow creates a sense of relative deprivation and a growing anxiety about being left behind.
• Easy Accessibility: Investing is possible with just a few taps on a smartphone app, making it not difficult at all to start stock investing.

Day Trading, All-in Investing… The 2030 Generation’s Risky Bets

Honestly, everyone wants to get rich quickly, right? Perhaps that’s why high-risk investments like day trading or so-called ‘all-in investing’ are trending among the 2030 generation. They take on excessive risks due to the desire to make large profits in a short period. Especially young professionals with little stock investment experience easily fall into these temptations, often leading to significant losses in an instant. Of course, with luck, you might hit the jackpot, but that applies to a very small minority. Most experience bitter failure and leave the stock market. Chasing a ‘one-shot’ gain is closer to speculation than investment.

• ‘One-Shot’ Mentality: Many expect high returns in a short period and concentrate their investments in leverage or theme stocks.
• Blind Trust in Information: There’s a tendency to rely on unverified social media or community information, leading to herd mentality trading.
• Loss Recovery Psychology: When experiencing losses, the thought of ‘just getting my money back’ often leads to more reckless investments, resulting in even greater losses.
• Lack of Investment Principles: Many invest simply by following trends without their own investment philosophy or principles.

A Realistic Perspective for Becoming Truly Rich

So, is there no hope for 2030 stock investment? No, absolutely not. However, we need to shift our perspective on how to become ‘truly rich’ to be more realistic. Stock investment should be viewed as a marathon, not a sprint. You need to consistently study, establish your own principles, and approach it with a long-term perspective. It’s also important to cultivate the mental fortitude to overcome market volatility without being impatient. Investment masters like Warren Buffett didn’t get rich overnight. Consistency and patience are ultimately the keys to successful investing.

• Maintain a Long-Term Perspective: It’s important to focus on the intrinsic value of companies and invest for the long term, rather than being swayed by short-term market fluctuations.
• Diversified Investment: As the adage goes, ‘don’t put all your eggs in one basket.’ Diversify your investments across various assets to reduce risk.
• Continuous Learning and Analysis: Continuously acquire knowledge necessary for investing, such as economic conditions and company analysis, and establish your own investment criteria.
• Don’t Be Swayed by Emotions: It’s necessary to train yourself to make investment decisions based on rational judgment, without being swept away by market fear or greed.

The 2030 stock market can certainly be an opportunity for us. However, making reckless investments driven by vague fantasies or impatience is truly dangerous. If you invest wisely with consistency and principles, you will surely achieve satisfactory results. I hope we all become successful investors.

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The Power of the ‘EPS Rally’: Index Driven by Corporate Earnings

Honestly, I don’t think this KOSPI surge is merely a speculative rally. The key is corporate earnings. Securities firms are successively raising their 2026 KOSPI targets, and the background for this is ‘record-high upward revisions in earnings forecasts’. In the past, stock prices often rose first, leading to increased valuation burdens, didn’t they? But this time is different. Analysis suggests that the 12-month forward EPS (Earnings Per Share) forecast is rising along with stock prices, resetting the index’s upper limit itself.
This means it’s closer to an ‘EPS-driven rally’ rather than a ‘PER-overstretched rally’. The contribution of the semiconductor industry’s earnings is particularly significant. With earnings expectations for semiconductor leaders like Samsung Electronics and SK Hynix at record levels, it’s fair to say that their profits are pulling KOSPI up by the scruff of its neck. Korea Investment & Securities presented a 2026 KOSPI target of 5650, and DB Financial Investment even projected it could open up to 7044 points. Isn’t this absolutely crazy?

Semiconductors and AI: New Growth Engines for the Korean Economy

The Korean economy is expected to grow by 1.8-1.9% overall in 2026. This is a clear improvement from 2025, but what’s noteworthy here is the change in the growth method. In the past, exports led the way, but now, domestic demand recovery, including private consumption and construction investment, is expected to be the central axis of growth. However, that doesn’t mean exports are losing their power. In particular, semiconductor and AI-centric investments continue, changing the direction of growth for the Korean economy.
With the global AI cycle not yet over, combined with worldwide liquidity expansion and government policies to boost the stock market, there are even predictions that the Korean stock market could perform better than the US. The high valuation burden in the US also increases the likelihood of capital flowing into the Korean market, so ‘retail’ investors should also pay close attention to these trends. The top sectors commonly cited by major securities firms are semiconductors, AI infrastructure, and power equipment.

The Power of Retail Investors and Market Volatility

Another characteristic of the Korean stock market is the high proportion and significant influence of individual investors. The surge of Samsung Electronics stock to 90,000 won in 2021, and EcoPro’s rise to 1.5 million won last year, were ultimately thanks to massive buying by individual investors. A public opinion poll also showed that nearly half of the population expects the Korean stock index to rise in 2026, so the expectations of retail investors are clearly an important factor driving the market.
Of course, the market cannot be without volatility. External factors such as interest rate cuts, exchange rate fluctuations, and geopolitical risks always affect stock prices. It’s also important to remember that the Korean stock market tends to react particularly sensitively to dollar movements. In such a situation, rather than being swept away blindly, it seems like now is the time for prudent judgment, investing based on corporate fundamentals and the long-term growth potential of industries.

KOSPI200, A Key Market Indicator

Just as important as the KOSPI index is the KOSPI200 index. This is a representative index of the Korean stock market and is used as a trading target index in the derivatives market. It gathers the top 200 companies by industry in the Korean stock market, so its reliability is very high. The KOSPI200 constituent stocks are changed annually on the day after the second Friday of June, and are selected by comprehensively considering market representativeness, liquidity, and marketability.
When selecting constituent stocks, newly listed stocks less than one year old and administrative issues are excluded, and the market capitalization proportion by industry group is also considered, so not just any company gets in. Ultimately, being included in the KOSPI200 means being recognized by the market, so it’s good to refer to it when investing.
The 2026 KOSPI market looks like it will be a very interesting year. Expectations are high, especially given that it’s a bull market supported by corporate earnings. Of course, the market always holds unpredictable variables, but by understanding these major trends and responding wisely, couldn’t we seize good opportunities?

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Personally, every time this happens, I feel that the world of investment is truly difficult. It started to fall due to President Trump’s strong remarks, then stabilized again due to news from a strait in the Middle East. Today, I’d like to talk about what exactly happened that day and what we need to know.

## 1. Trump’s ‘Stone Age’ Remarks Freeze the Market

In fact, the US stock market was unusual from the start of the day. US President Donald Trump made very strong remarks about Iran. In a national address, he said, “We will hit Iran extremely hard for the next 2-3 weeks,” and even, “We will turn Iran back to the Stone Age.”

When such harsh words came out, the market had no choice but to react immediately. Investor sentiment rapidly contracted due to concerns about escalating geopolitical tensions, and the Dow Jones Industrial Average started to decline.

Honestly, I think such strong remarks directly affect international oil prices. In fact, the price of West Texas Intermediate (WTI) crude oil once surged by 13%. I realized once again how much impact a single unpredictable political statement can have on the global economy.

## 2. Strait of Hormuz Holds the Key to Reversal

But then, an unexpected reversal occurred in this frozen market. It was due to expectations regarding transit through the Strait of Hormuz. The Iranian Foreign Ministry announced that it was preparing a draft agreement with Oman to manage ship traffic.

As this news spread, market anxiety significantly decreased. International oil prices also gave back some of their gains, and while only the Dow Jones fell slightly, the S&P 500 and Nasdaq turned upward. Who would have known that the situation in the Middle East would play such a crucial role?

As many of you probably know, the Strait of Hormuz is a very important place where about 20% of the world’s seaborne oil transport passes. Ensuring safe passage through here is news that brings great relief to the global economy.

## 3. The Dual Face of the Strait of Hormuz: Transit Fee Controversy

But here’s another story. While Iran is preparing an agreement for safe passage through the Strait of Hormuz, it is actually showing signs of imposing a ‘transit fee’. The Iranian parliament reportedly approved a plan to impose transit fees on ships passing through the strait.

If this becomes a reality, there is talk that a transit fee of about $1 per barrel could be collected. For very large oil tankers, this could amount to billions of Korean Won. Honestly, this could lead to controversy over violations of international law and could be a significant burden for countries like ours that import crude oil.

Looking at this situation, I realize once again that the Strait of Hormuz goes beyond simply meaning ‘safe passage’ and exerts enormous influence on international politics and economics. I’m really interested to see how this transit fee issue will unfold in the future.

## 4. Market Resilience Seen Even Amidst Volatility

In conclusion, on April 2nd, the US stock market closed mixed, with President Trump’s strong remarks and expectations for transit through the Strait of Hormuz clashing. The Dow Jones Industrial Average fell by 0.13%, but the S&P 500 index rose by 0.11%, and the Nasdaq Composite index rose by 0.18%.

This situation shows that while the market reacts sensitively to geopolitical risks, it also has the resilience to recover quickly when diplomatic solutions or prospects for improvement are seen. As an investor, I think it’s really important to read these market trends well.

Of course, international situations are always unpredictable, but we should still try not to miss the big trends. I hope we all achieve successful results through wise investment!

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