ChainCatcher report, according to朝鲜商业 on October 25, following a sharp decline in the Korean stock market, individual investors have resumed buying single-asset leveraged products betting on rebounds in Samsung Electronics and SK Hynix. Data from the Korea Exchange and Koscom ETF Check show that between October 1 and 23, individual investors net purchased 315.4 billion KRW in 14 related products, including 226.3 billion KRW in the seven products linked to SK Hynix and 89.1 billion KRW in the seven linked to Samsung Electronics. These 14 products saw net purchases of 2.7728 trillion KRW in July; after regulatory tightening, including an increase in collateral requirements on July 31, they turned to net sales, with net sales of 648.4 billion KRW in August and 497.9 billion KRW in September. This month marks the first net purchase by individuals since then. During the same period, KODEX SK Hynix Single-Asset Leveraged ETF recorded net purchases of 152.9 billion KRW, ranking 11th among all listed ETFs in Korea; individuals also net purchased 1.0448 trillion KRW in KODEX Leveraged ETF and 256.4 billion KRW in KODEX Semiconductor Leveraged ETF. The Korean Composite Stock Price Index fell 18.83% in October. According to data from the Korea Securities Depository, between October 1 and 22, Korean investors net purchased $4.8009 billion (approximately 6.3621 trillion KRW) in U.S. stocks. Among these, SOXL, which tracks the daily return of the U.S. semiconductor index at 3x leverage, saw net purchases of $3.54764 billion (approximately 4.7041 trillion KRW), accounting for 73.9% of total U.S. stock net purchases during the period. The article also notes that leveraged products track daily returns at multiples; when market conditions reverse, losses are amplified two or threefold, and repeated sharp rallies and declines can lead to negative compounding effects.
South Korean retail investors rebound in purchasing semiconductor leverage products
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Summary
Leverage trading in South Korea’s retail market is increasing as investors return to semiconductor-linked products. From October 1 to 23, individuals purchased 14 related products totaling 3.154 trillion KRW. SK Hynix-linked products accounted for 2.263 trillion KRW, while Samsung Electronics-linked products totaled 891 billion KRW. The KODEX SK Hynix Single-Stock Leveraged ETF attracted 1.529 trillion KRW in net inflows, ranking 11th among ETFs. KODEX Leveraged and Semiconductor Leveraged ETFs saw inflows of 1.0448 trillion and 256.4 billion KRW, respectively. Meanwhile, the 3x leveraged U.S. semiconductor index ETF SOXL was net bought for $35.4764 billion (4.7041 trillion KRW), representing 73.9% of total U.S. stock inflows. Value investing in crypto and physical markets is showing signs of convergence.
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