Dovey Wan: South Korea might be one of the clearest top indicators for global risk assets

Odaily Planet Daily News: Primitive Ventures founding partner Dovey Wan posted on X, stating that from the "kimchi premium" in each crypto cycle to the current "memory stocks" (meme stocks), South Korea might be one of the clearest late-cycle indicators for global risk assets. This is not only because South Korean retail investors are extremely狂热投机者 (degens), but also because the market structure itself further fuels the retail frenzy.

South Korea launched a leveraged product for single stocks on May 27th, at a time when the asset's rally was already nearing a vertical surge. Local South Korean retail investors flooded in at the peak speed of narrative heat, in contrast to investors in Hong Kong-listed leveraged products who had a cushion of several months of upward momentum beforehand.

When a domestic stock market that is already overcrowded adds leverage instruments to its hottest stocks after the assets enter a reflexive rally phase, the launch of such a product itself constitutes the formation of a top signal.

This happens every single time in the cryptocurrency cycle – South Korean local exchanges typically list assets only after they have undergone parabolic surges on other global exchanges, leaving the unfortunate South Korean retail investors as the final exit liquidity.