Wall Street’s biggest prime brokers are quietly turning the screws on hedge funds piling into Samsung Electronics and SK Hynix stocks, Bloomberg has learned.

Citigroup, JPMorgan, Goldman Sachs, Bank of America, BNP Paribas, and UBS have all hiked swap financing rates sharply. Morgan Stanley has gone further: it’s simply refusing new swap orders on both Korean stocks.

Brokers including Citigroup Inc., JPMorgan Chase & Co. and Goldman Sachs Group Inc. have raised the financing cost for hedge funds to take bullish wagers on SK Hynix and Samsung Electronics shares via swaps, said the people.

SK Hynix has tripled this year, while Samsung is up over 175%. Together they now account for 53% of the entire Kospi index, more than double their combined weight five years ago.

The banks aren’t being generous with explanations, but the logic isn’t hard to read. Few counterparties want to bet against stocks moving like this, so banks often end up holding the exposure themselves.

Some banks are still accepting new trades, assessed case by case. Meanwhile, the tolerance is shrinking, and the funds that earned massive amounts from Samsung and SK Hynix this year are now paying significantly more.

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