Over the past month, single-stock leveraged exchange-traded funds (ETFs) tied to Samsung Electronics and SK hynix drew in about 7 trillion won.
According to the Korea Exchange (KRX) and ETF CHECK on the 17th, from on the 16th of last month to on the 15th, a net 7.3364 trillion won flowed into 16 single-stock leveraged and inverse products tracking Samsung Electronics and SK hynix.
By product, "KODEX SK hynix Single-Stock Leverage" saw 3.4472 trillion won in inflows, the largest amount, followed by "KODEX Samsung Electronics Single-Stock Leverage" (1.5083 trillion won) and "TIGER SK hynix Single-Stock Leverage" (1.4271 trillion won). "TIGER Samsung Electronics Single-Stock Leverage" recorded a net inflow of 693.8 billion won.
During this period, shares of Samsung Electronics and SK hynix fell 19.49% and 24.33%, respectively. Even so, money continued to pour into single-stock leverage products. KODEX SK hynix Single-Stock Leverage and KODEX Samsung Electronics Single-Stock Leverage, which had the largest net inflows, fell 45.60% and 48.44%, respectively, over the same period.
In particular, the share of individual investors was found to be high. Individual investors net bought a combined 4.2386 trillion won across seven SK hynix single-stock leverage products and a total of 1.6119 trillion won across seven Samsung Electronics single-stock leverage products. Foreign investors also net bought 859.5 billion won and 724.2 billion won, respectively, but far less than individuals. Institutions showed net selling of 5.1713 trillion won and 2.2671 trillion won.
After side effects led to heightened stock market volatility, the financial authorities on the 16th unveiled safeguards strengthening investment requirements. As a result, starting on Aug. 5, the basic deposit requirement to invest in single-stock leverage products will increase to 30 million won from the current 10 million won.
In addition, single-stock leverage products can no longer be traded one share at a time as now, but only in lots of 20 shares. This is intended to reduce trading volume. Implementation is scheduled for November. Investor education that must be obtained from the Korea Financial Investment Association before product transactions was also strengthened.