South Korea Suggests Comprehensive Review of Capital Market Structure, Rejecting Leverage ETF as Sole Cause of KOSPI Volatility

According to BlockBeats, on July 29, South Korea's presidential policy office suggested a comprehensive review of the capital market structure, stating that leverage exchange-traded funds are not the sole driver of KOSPI volatility. Policy office director Kim Yong-beom attributed market weakness to multiple factors: high concentration of semiconductor and AI-related stocks (40-50% of the market), significant holdings of derivatives and ETFs, and intensifying competition from China's semiconductor industry. While leverage ETF rebalancing may cause temporary market impact, Kim noted that some volatility occurs at market open, ruling out leverage ETFs as the single cause. The office recommended a broader examination of the entire market structure.
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