The skyrocketing stock prices of Samsung and SK Hynix have triggered a forced fund sale, with a net foreign selling of $58.6 billion year-to-date.

May 29 (Bloomberg) — Samsung Electronics Co. and SK Hynix Inc.’s sharp stock rallies have forced some funds to slash their holdings, as they hit the 10% single-stock ownership limit that forces portfolio adjustments for diversification rules. Firms including GAM Investment Management and Jupiter Asset Management are now tweaking their positions to comply. Over the past year, SK Hynix has surged over 1,000% while Samsung Electronics gained more than 400% — both now boast market valuations topping $1 trillion. As of Thursday, global investors have net sold $63.6 billion in South Korean stocks this year, with Samsung and SK Hynix together accounting for $58.6 billion of that outflow. Goldman Sachs Group Inc. estimates roughly $69 billion in sell-offs since last October stemmed directly from these ownership caps. Some institutions are shifting to alternative semiconductor plays for exposure: SK Square Co. (which holds a 20.5% stake in SK Hynix) and Samsung Life Insurance Co. (with an 8.58% holding in Samsung Electronics) have seen steep stock gains over the past year. Goldman added that if Samsung and SK Hynix’s weight in South Korea’s stock market keeps climbing, more selling pressure could come down the line — though most passive unwinding is either complete or nearly done.