South Korea's Stock Market Triggers Circuit Breaker, Financial Commission Considers Investment Limits on Leveraged ETFs

According to SUPPLY, South Korea's stock market plunged during today's session (July 29) and activated a level-one circuit breaker. Financial Commission chair Lee Eui-won stated that if demand for single-stock leveraged ETFs fails to cool sufficiently, regulators will research further measures including personal investment caps.

The Financial Commission has already announced that starting July 31, it will raise the minimum margin for single-stock leveraged ETFs to 30 million won and strengthen investor education. Authorities also plan to cap single-stock leveraged ETF holdings at 20% of individual investors' total financial assets, tighten entry requirements, and require fund companies to stagger ETF rebalancing times to reduce market volatility.