Foreign HFT Traders Account for Up to 49.9% of Single-Stock Leverage ETF Trading on July 10

According to the Korea Exchange on July 10, foreign high-frequency traders (HFT) accounted for 36.9% to 49.9% of total trading volume in the top-traded single-stock leverage ETFs for Samsung Electronics and SK Hynix. Industry participants attribute extreme volatility in these products largely to foreign HFT, which enjoy creation and redemption rights unavailable to retail investors while facing no quote-posting obligations like domestic securities firms.

Financial industry sources say restricting foreign HFT's creation and redemption privileges could significantly reduce trading volume and market volatility. Analysts note HFT traders can exploit predictable ETF rebalancing patterns—buying ahead of anticipated large fund purchases or selling in advance of fund liquidations—while maintaining superior speed and lower computational overhead compared to domestic market makers.