A large number of leveraged exchange-traded funds (ETFs) that track the daily increase rate of the underlying assets by more than 2 times are included in the top net purchases of 'Seohakgaemi' (overseas stock individual investors). Additionally, the underlying assets of leveraged ETFs, which had previously focused on semiconductor indices or Tesla, have broadened to growth stocks.
According to the Korea Securities Depository (KSD) on the 25th, domestic investors net purchased 'SOXL' worth $276.06 million (approximately 383 billion won) during the recent week (Aug. 18-22). This was the largest net purchase among overseas stocks. SOXL is an ETF that tracks the daily increase rate of the U.S. semiconductor index by 3 times.
Among the top 50 net purchases in the past week, 17 (34%) were leveraged and inverse ETFs. 'PLTU' and 'PTIR,' which track the daily stock price increase rate of Palantir (PLTR) by 2 times, ranked 4th and 8th in net purchase size.
Also notable are ▲ 'MSTU,' which tracks the daily stock price increase rate of Strategy (MSTR), famous for its Bitcoin treasury strategy, by 2 times, ▲ 'IONX,' a 2x leveraged ETF of quantum computing company IonQ (IONQ), and ▲ 'HIMZ,' which tracks the daily stock price increase rate of healthcare company HIMS & HERS by 2 times; these ranked 9th, 10th, and 13th in net purchase size.
Domestic investors have also started buying themed stocks that follow through leverage. 'UNHG' is a representative example. This ETF tracks the daily stock price increase rate of UnitedHealth Group (UNH) by 2 times. Domestic investors recently net purchased $188.68 million (approximately 261.5 billion won) worth of UNH stock, and also showed a buying preference of $9.12 million (approximately 12.5 billion won) for UNHG.
UNH has seen its stock price decline following the assassination of its CEO, but recent disclosures revealed that Berkshire Hathaway, led by 'the oracle of Omaha' Warren Buffett, acquired nearly 5.04 million shares of UNH, attracting attention from Seohakgaemi. It seems that Buffett's last investment of approximately 2 trillion won before retirement stimulated investor sentiment.
Exchange-traded funds (ETFs) related to nuclear power are also eye-catching. 'OKLL' and 'SMU,' which track the daily stock price increase rates of Oklo (OKLO) and NuScale Power (SMR), which develop small modular reactors, ranked 42nd and 46th in net purchase size for the past week.
With the strong intention of the Donald Trump U.S. administration to revive the nuclear industry, it is interpreted that investments have been made ahead of the review of the 3.5 generation SMR project.
Experts assess that Jerome Powell, the U.S. Federal Reserve (Fed) chairman, may pursue an accommodative monetary policy considering the employment downturn, which could revive the preference for risk assets for the time being. This implies that leveraged investing could be successful.
The issue is that due to the nature of leveraged investing, volatility is high, and long-term holding can lead to losses increasing due to the 'negative compounding effect.' This signifies that responding swiftly to market inflection points is key to increasing investment revenue.
The market considers the performance announcement of NVIDIA (NVDA) due to be released early in the morning on the 28th, Korean time, to be significant.
SK Securities researcher Jo Jun-ki noted, "The market interprets Chairman Powell's speech as dovish (favoring easing), likely giving a positive influence on risk assets in the short term. However, we must confirm employment and inflation indicators once more before the September Federal Open Market Committee (FOMC)." He added, "I think the NVIDIA earnings report will be the biggest event of the week."