South Korea's Single-Stock Leveraged ETFs Drop 20-26% Within 1.5 Months of May Launch

According to Korea Exchange data, single-stock leveraged ETFs for Samsung Electronics and SK Hynix have declined significantly since their May 27 listing through July 10. TIGER Samsung Electronics Leveraged ETF fell 25.8%, KODEX Samsung Electronics Leveraged ETF fell 25.5%, TIGER SK Hynix Leveraged ETF fell 22.1%, and KODEX SK Hynix Leveraged ETF fell 21.7%, according to Financial News.

Despite price declines, trading volumes remained active in July compared to June, with three of the four products seeing increased average daily trading. Meanwhile, individual investors withdrew capital from other non-leveraged ETFs following the new product launch, with daily average net purchases of all non-leveraged ETFs dropping from 551.9 billion won in April-May to 116.4 billion won in the launch week of May-June. Government officials announced plans to review the policy's market impact through the Finance 4 (F4) meeting.