business
South Korea Weighs Fixes for Single-Stock Leveraged ETFs After Market Swings
Finance Minister Koo Yun-cheol said the government is discussing steps to address volatility linked to newly introduced products. The ETFs track Samsung Electronics and SK hynix, which together represent roughly half of KOSPI market capitalization.
Jul 7, 4:10 AM·1m read1 source
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Finance Minister Koo Yun-cheol said Tuesday the government is considering measures to address problems arising from newly introduced single-stock leveraged ETFs. "I am well aware that leveraged ETFs have brought significant volatility to the stock market," Koo said during a parliamentary session at the National Assembly in Seoul.
"When introducing the policy, we assessed its potential impact on the foreign exchange and capital markets, but some problems have since emerged," he said.
The Korea Exchange introduced the products in May. They track the daily performance of Samsung Electronics Co. and SK hynix Inc. The two companies account for roughly half of the KOSPI's total market capitalization, Yonhap reported.
Despite a strong rally since the start of 2026, the KOSPI has experienced sharp swings in recent months. The Korea Exchange has triggered market-wide circuit breakers six times this year after the index fell more than 8 percent from the previous session's close. Before 2026, circuit breakers had been activated only six times in total.
In addition, 32 sidecars have been triggered this year, the highest annual tally on record and above the previous high of 26 in 2008, Yonhap reported.
