Taiwan AI stock boom triggers borrowing investment frenzy, regulators issue risk warning

According to Euronews, Taiwan's stock market surged 59% in the first half of the year amid a sharp increase in AI hardware demand, with chip giants such as TSMC serving as the primary drivers. Driven by expectations of high returns, many ordinary citizens entered the market by borrowing funds through bank loans and property mortgages, causing the scale of margin trading to grow by nearly 20% compared to the first half of the year. While some investors reaped substantial profits—for instance, Mr. Chen, a real estate professional who borrowed 5 million New Taiwan dollars, saw his assets quadruple within six months—others suffered heavy losses. An anonymous user reported losing nearly half of their investment after putting over 10 million New Taiwan dollars (including a 6 million mortgage loan) into the market, even experiencing mental health issues. The Taiwan Financial Supervisory Commission stated that overall credit risk remains within manageable limits and has already released warning videos on social media to alert young investors to the risks of loan defaults.