Sandfire (BHP is 2nd) has the highest correlation to Samsung, without the steroids on the upside, but its ~17% fall in the last 4 weeks has followed a very similar path to the Korean semiconductor giant. MMs portfolios are skewed towards copper and the miners; hence it’s been a tough few weeks, but we remain comfortable with our underlying analysis and are more likely to add to our exposure than trim into current weakness.
We don’t believe SFR is a great proxy to gain exposure to panic selling in semiconductors, but as the chart below illustrates, there correlation is pretty good over the last few months.
- We like the risk/reward towards SFR around $18 following its ~17% pullback.
MM is long and bullish towards Sandfire around $18
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chart
Sandfire Resources Ltd (SFR) v Samsung Electronics (005930 KS)
chart
Sandfire Resources Ltd (SFR) v Samsung Electronics (005930 KS)
