Friday, May 28, 2010

South Korea an opportunity to invest: SK Telecom

Recent fears of fresh tensions between North and South Korea have created panic in the South Korean stock market. While this is temporarily inconvenient for investors, it is actually an opportunity for others that have not even touched the South Korean market.

But you don't need to go to Seoul to invest money in the country. You can purchase South Korean stocks in the NYSE. For instance, SK Telecom (NYSE:SKM), which has roughly a 50% market share in the wireless telecom market, is currently 15% cheaper than what it was several weeks ago. Why? Not because the company had any fundamental flaws, but because of fears of war.

Will North and South Korea actually blow each other up? The answer is no. Most of it is being resolved through the United Nations and punitive sanctions. Once the general market realizes that the region is stable, the 15% discount on SK Telecom will quickly disappear.

This is the reason why I'm definitely looking at SK Telecom. A brief study of their history and moves show they're not scared to even invest outside the market, such as their brief stint at running Helio, which was taken over by Virgin and ultimately Sprint.