Leverage ETF for Korean stocks ignites the market

Glonghui, May 30 ｜ According to CCTV Finance, on the 27th, South Korea launched single-stock leveraged ETFs for the first time. Sixteen leveraged and inverse ETFs with 2x leverage, linked to Samsung Electronics and SK Hynix, were listed on the Korean stock market. As large amounts of leveraged funds poured in, the Korean stock market saw increased volatility this week, showing a “roller coaster” trend. Data shows that on the first day of trading, the total assets of related products reached 4.3 trillion Korean won. By the close on the 28th, this figure had further climbed to 5.02 trillion Korean won, approximately 22.5 billion yuan. Previously, such single-stock leveraged ETFs had been explicitly banned in South Korea. Now, once launched, they have attracted the enthusiastic participation of a large number of retail investors. Industry insiders analyzed that this leveraged boom in the Korean stock market is a fierce collision between the booming AI computing power demand and financial speculation sentiment. While pursuing amplified returns, investors should remain highly alert to the compounding risks hidden behind high leverage.