October 12 Investment Report: AI Value Investing Portfolio +64.3%

KOSPI Plunges Despite Wall Street Rally… AI Value Portfolio Stays Calm Amid -2.62% Pullback

U.S. markets rallied in unison in overnight trading on October 10, led by a 0.83% gain in the Dow Jones, but on October 11 the KOSPI tumbled 2.62% to 6,625.93, wiping out the previous day's advance in one stroke. The tug-of-war between supply and demand over defending a hot trading range is deepening by the day. Even amid this market turbulence, the AI Value Investing Portfolio is holding steady, maintaining a 64.31% return on its initial $10,000 capital.

Assets Down Over 5% in Five Days — But Returns Remain Solid

Looking at the portfolio's asset flow, it peaked at $17,315.70 on October 7 before falling to $16,431 two days later, a decline of roughly 4.4% from the prior day. A sharp drop in semiconductor-related sectors was the main culprit. Nevertheless, the overall return is still holding above 64%. Reducing leverage exposure and reallocating funds into individual undervalued stocks during the plunge minimized the damage.

Holdings Diagnosis: Betting Not on Value vs. Growth, But on "Undervaluation Within Growth"

A closer look at the holdings' valuations reveals the backbone of this portfolio. NVIDIA trades at a P/E of 29.1 with a PEG of 0.29, suggesting the stock still lags its growth rate. Broadcom, with a PEG of 0.37, is similarly viewed as not fully pricing in AI infrastructure demand. Micron, with earnings per share of $74.33, is far from expensive at current prices, backed by momentum from rising HBM supply prices. AMD, however, warrants watching, as its P/E above 158 means volatility could be high if earnings fail to meet expectations.

Recent Trades Review: Shedding Leverage, Loading Up on "True Undervaluation"

The recent trading pattern is clear. On the 9th, the portfolio partially sold its 3x leveraged products, SOXL and TQQQ, to reduce volatility, using the proceeds to add to Micron. The case for Micron rested on extreme undervaluation — a forward P/E of 5x and a PEG of 0.16 — supported by the continuation of the memory supercycle. The decision to treat the sell-off as an opportunity for staged buying at lower prices is a classic value investing approach that turns market fear into a buying opportunity. The dual strategy of shrinking leverage while concentrating on undervalued blue chips stands out.

Market Outlook: Signals From Gold and the Dollar

Daily indicators show the U.S. 10-year Treasury yield holding at elevated levels of 5.244%, while gold futures rose 1.43% to break above the $4,216 mark. Oil also edged higher, signaling that inflationary pressure has not fully faded. Meanwhile, the VIX fell 3.7% to 14.84, a sign that extreme panic has not set in. U.S. markets closed higher, but the Philadelphia Semiconductor Index's 0.41% decline hints that semiconductor-led corrections may continue for now. That said, with a higher weighting of undervalued blue chips versus growth stocks, this portfolio is relatively defensively positioned for sharp sell-offs — a positive.

※ This report analyzes the simulated operation of the AI Value Investing Portfolio and is not investment advice. Actual investments should be made at your own judgment and discretion.