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After South Korean Stock Market Plunge, National Assembly Entrance Filled with Wreaths: Retail Investors Call for the Disbandment of Samsung and SK Hynix Leveraged ETFs

BlockBeats News, July 29th. According to The Korea Times, after the sharp drop of the Samsung Electronics and SK Hynix single-stock leveraged ETFs, individual investors' dissatisfaction has been on the rise. On that day, about 30 mourning wreaths appeared in front of the National Assembly building in Yeouido, Seoul, calling for the abolition of the related 2x leveraged ETF products.

The wreaths were sent by the individual investor group "Stock Market Normalization Conference," with demands including strengthened investor protection and the removal of related products. The group believes that the Samsung Electronics and SK Hynix single-stock leveraged ETFs have amplified stock price volatility and exacerbated retail investors' losses.

This protest took place after a sharp fluctuation in the Korean stock market. On the previous trading day, the KOSPI index plummeted over 8%, triggering a circuit breaker; single-stock leveraged products tracking Samsung Electronics and SK Hynix also plummeted by about 25%. Against the backdrop of the AI hardware sector's downturn and the semiconductor leader's sharp decline, the risk of high-leverage products was rapidly magnified.

The South Korean financial authorities have started tightening trading requirements. The Financial Services Commission plans to require individual investors to hold a minimum of 30 million Korean Won in cash basic margin when purchasing new or adding to positions in single-stock leveraged products starting from July 31st. South Korean Financial Services Commission Chairman Lee Eung-tae stated that industry insiders expect that after the implementation of this measure, the number of related trading accounts may decrease from around 100,000 to about 10,000, and the trading volume could decrease by approximately 60%.

Source: BlockBeats

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