The global AI bull market is shadowed by massive leverage risks. US margin debt has reached a record $1.4 trillion, while leveraged ETF assets doubled to $220 billion in just two months. South Korea's KOSPI index experienced violent swings due to high leverage and concentrated positions, triggering a circuit breaker. Barclays and Morgan Stanley warned that leveraged derivatives could cause a negative deleveraging spiral, amplifying market declines. These developments highlight potential systemic risks that investors must monitor closely.
Market Data Reveals Leverage Concerns
Behind the global AI bull market, significant leverage risks are emerging. According to data, US margin debt has hit a record $1.4 trillion, while assets under management in leveraged ETFs have doubled to $220 billion over the past two months. These high-leverage tools amplify both gains and market volatility.
Circuit Breaker in Korea & Institutional Warnings
South Korea's KOSPI index recently experienced sharp swings due to high leverage and concentrated positions, even triggering a circuit breaker. Barclays and Morgan Stanley have warned that leveraged derivatives could set off a negative deleveraging spiral, further magnifying market declines. Investors should be cautious of these potential systemic risks.
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