A leverage exchange-traded fund (ETF) based solely on Samsung Electronics as its underlying asset recorded a rise of over 8% on its first day of listing.
According to the Hong Kong Stock Exchange (HKEX) on 28th, the CSOP Samsung Electronics Daily 2X Leverage finished trading at 8.48 Hong Kong dollars. It increased by 8.22% (0.644 Hong Kong dollars) compared to its listing price (7.8 Hong Kong dollars). The CSOP Samsung Electronics Daily -2X Inverse, listed together, fell by 7.35% (0.576 Hong Kong dollars) to finish at 7.26 Hong Kong dollars. This was influenced by the rise of 3.71% (2,000 won) in Samsung Electronics' stock price that day in the KOSPI market.
The CSOP Samsung Electronics Daily 2X Leverage and CSOP Samsung Electronics Daily -2X Inverse use a swap contract synthetic method to respectively track the daily price increase and decrease rates of Samsung Electronics common stock by a factor of two. The leverage and inverse ETFs that follow only Samsung Electronics' stock price are the first of their kind in the world. CSOP Asset Management, regarded as Asia's largest ETF issuer, listed these products on the Hong Kong Stock Exchange that day.
CSOP Asset Management noted that the trading hours of the Hong Kong stock market have little difference compared to those in Korea, which increases its usability. CSOP Asset Management said, "For investors forecasting a rise in Samsung Electronics' stock price, the leverage product can provide higher exposure, while the inverse product can serve as a hedge against short-term stock price volatility."
CSOP Asset Management also explained, "The Samsung Electronics leverage and inverse ETFs have advantages such as tight bid-ask spreads and maximum leverage limits, making them attractive alternatives for investors willing to take risks compared to contracts for difference (CFD), futures options, margin trading, and short selling."
The minimum transaction unit for CSOP Samsung Electronics Daily 2X Leverage and CSOP Samsung Electronics Daily -2X Inverse is 100 shares. The annual management fee is 1.6% of the ETF's net worth (NAV).