South Korean retail investors are estimated to have lost about 2.3 trillion won, or roughly $1.7 billion, between May 27 and Aug. 14 through leveraged exchange-traded funds and note products tied to Samsung Electronics and SK Hynix, according to a Bloomberg report citing data referenced by a South Korean lawmaker’s office from the Financial Supervisory Service. Since July, local regulators have responded with temporary restrictions aimed at curbing risks in the segment. Those steps include a temporary ban on listing new leveraged single-stock products, higher minimum cash margin requirements, and stronger investor education measures. The figures and the policy response point to mounting concern in South Korea over retail exposure to highly leveraged products linked to individual equities.
According to Bloomberg, a South Korean lawmaker’s office, citing data from the Financial Supervisory Service, said retail investors in the country are estimated to have lost about 2.3 trillion won, or roughly $1.7 billion, between May 27 and Aug. 14 through leveraged single-stock exchange-traded funds and note products tied to Samsung Electronics and SK Hynix.
Since July, South Korean regulators have taken temporary steps to rein in risks tied to those products. The measures include a temporary ban on listing new leveraged single-stock products, higher minimum cash margin requirements, and stronger investor education.
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