Leverage ETF Trading Plummets Sharply After Deposit Hike
The “double betting” boom that hovered around 12 trillion won (about $8.68 billion) a day has cooled off. The trading value of single-stock leverage and inverse exchange-traded funds (ETFs) for Samsung Electronics and SK hynix, which once easily exceeded 10 trillion won, plummeted to the 700 billion
The trade in single-stock leverage and inverse exchange-traded funds (ETFs) for Samsung Electronics and SK hynix has sharply declined after the financial authorities raised investment thresholds. Previously, these products experienced a double betting boom, with daily trading values exceeding 12 trillion won. However, after the basic deposit requirement was strengthened, trading values plummeted to 711 billion won by August 26, down from 12.4485 trillion won just before the regulation change.
Financial authorities stated that the market had entered a stable phase, with the proportion of single-stock leverage products in the overall market decreasing and market capitalization remaining stable. A securities firm official noted that the concentration on specific products caused significant burden on securities firms' systems and expressed relief that the cooling effect of the regulations is evident.
The single-stock leverage products for Samsung Electronics and SK hynix entered the domestic market on May 27, with trading values reaching 10.4 trillion won on their listing day. The concerns over increased stock price volatility and concentration on specific stocks led to regulatory measures, including tripling the basic deposit requirement from 10 million won to 30 million won.
Despite the cooling of trading fever, the incident highlights the challenges of balancing investor protection with the need for innovative investment products.
Written by urgent.news from BusinessKorea's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
