Hanyang Securities rolled out financial education content that explains in simple terms the structure and risks of single-stock 2x leveraged exchange-traded funds (ETFs).
Hanyang Securities said on the 29th that it produced the financial education content "Leverage investment advisory" and released it through its digital channels, including YouTube, Instagram, and TikTok.
Using single-stock leveraged ETFs tied to Samsung Electronics and SK hynix as examples, the content explains the profit structure of leveraged products and points to note when investing. In particular, it introduced the fact that leveraged ETFs track twice the underlying asset's daily return, not twice the total return over a period.
Hanyang Securities also presented an analysis of actual data from May 27, the listing date, to July 22. During the period, the share price of Samsung Electronics fell 15.2%, but the average return of the related single-stock leveraged ETFs dropped 40.2%. SK hynix likewise saw its share price fall 18.4%, while the leveraged ETFs were shown to have declined an average of 49.4%.
It also included a simulation assuming the underlying asset's daily volatility remains the same while the final cumulative return is 0%. In this case, the average return of the Samsung Electronics single-stock leveraged ETF was -14.4%, and SK hynix recorded -21.1%. It was also analyzed that if the same level of volatility continues for six months to a year, even if the underlying asset returns to its original level, the leveraged ETFs could fall about 40–50% after six months and about 63–75% after one year.
Hanyang Securities said that through these examples, investors need to understand that in a highly volatile market, even if the underlying asset recovers its original price, a leveraged ETF may not make up for losses.
The content is provided across various platforms, including the YouTube channel "Hanyang Dictionary," Instagram card news, and TikTok, and will also be used as financial education material for retail customers.
A Hanyang Securities official said, "Single-stock 2x leveraged ETFs are products that draw strong interest from investors, but not a few invest without fully understanding the product structure," adding, "We will continue to expand financial education content so customers can easily understand the features and caveats of financial products, and we will take the lead in spreading a sound investment culture."