The Office of the President of South Korea’s National Policy Director Kim Yong-beom stated on July 19 on the Korean Broadcasting System (KBS) news program that the government will not delist single-stock leveraged stock products related to Samsung Electronics and SK Hynix. The reason is that investors have already put more than 10 trillion Korean won (about $6.72 billion) into these leveraged products, and delisting would create too large an impact on the market.
Kim Yong-beom: Won’t delist Samsung Electronics and SK Hynix-related single-stock leveraged stock products
On the KBS program, Kim Yong-beom directly quoted the following: “These products are already listed, and investors have put more than 10 trillion Korean won (about $6.72 billion) into them, so delisting could bring a massive shock to the market.” He explained that the current policy focus should be on limiting these products’ impact on trading, rather than on delisting.
Kim Yong-beom also explained the mechanism of single-stock leveraged products: “The feature of a single-stock leveraged product is that in a rising market, returns are doubled, and in a falling market, losses are doubled. As the gap between the market price and net asset value narrows, selling pressure becomes concentrated in specific time windows. Therefore, regulators, asset management companies, and brokerages need to jointly discuss how to reduce market impact.”
The problem of trade concentration in single-stock leveraged stock products
Kim Yong-beom explained that single-stock leveraged ETFs and ETNs rely on liquidity providers to adjust their positions to keep the gap between market price and net asset value relatively small, which leads to the underlying stocks’ trades concentrating in specific time windows during the day. The market’s main concern is: when the stock price falls sharply, the large volume of stocks that must be sold in a concentrated manner to maintain the leverage ratio could further drive the price down.
Kim Yong-beom said that addressing this issue requires changing approach: “We should review a range of options, such as whether the management cycle can be extended from 30 minutes to about 2 hours, or whether we must handle it through buying and selling underlying assets, and whether derivatives can be used, so that the impact is not concentrated at a particular time window during the day.”
A triple surge in real estate: Kim Yong-beom apologizes and lists short-term housing supply measures
Kim Yong-beom apologized on the KBS program regarding the “triple surge” in the real estate market (house sale prices, deposit for jeonse over the full lease term, and monthly rent all rising at the same time), saying, “I’m sorry to many people. The current supply-demand situation and some other conditions are extremely severe.”
He said that solutions to housing problems must come from measures that can take effect quickly, and listed the following short-term supply options:
Public purchase and rental market: Kim Yong-beom called it the most effective measure in the short term, saying that policy resources will be mobilized immediately in a targeted way.
Non-apartment housing: Provide housing types other than apartments to increase short-term supply.
Expansion of supply for office residences (office hotels): Convert Seoul commercial buildings into office hotels that combine commercial and residential use.
Third New Town plan commercial land conversion: Convert part of the commercial land into residential land.
Revitalization of semi-industrial land in Seoul: Kim Yong-beom said he has submitted development proposals for semi-industrial land in Yeongdeungpo and Guro District to Seoul Mayor Oh Se-hoon, and the mayor has personally conducted on-site inspections.
Kim Yong-beom also ruled out the possibility of using rebuilding and renovation as short-term supply measures, explaining that “rebuilding and renovation require at least three to five years.”
A framework for property tax reform: differentiate treatment between multi-home owners and single owner-occupant type
Kim Yong-beom explained that the basic principle behind property tax reform is to distinguish between owners who hold multiple properties and owners who hold a single property, and to apply different tax treatment to owner-occupied homes versus non-owner-occupied homes. He said: “If house prices are extremely expensive, considering owners’ ability to pay and their impact on the market, we should treat single-property owners differently—this idea has basically reached consensus. The remaining question is how to draw the line.”
Regarding whether raising holding taxes must be tied to lowering capital gains taxes, Kim Yong-beom did not make a clear statement, saying, “We can adopt various options, and the fairness of taxation also must be weighed.”
Frequently asked questions
Why did the South Korean government decide not to delist single-stock leveraged stock products related to Samsung and SK Hynix?
Based on Kim Yong-beom’s explanation on the KBS program, investors have already put more than 10 trillion Korean won (about $6.72 billion) into these types of products, and delisting would cause too large an impact on the market. The government’s policy focus has shifted to studying how to limit trading impact from these products, including reviewing whether to extend the management cycle and using derivatives as a substitute for trading the underlying stocks.
What does Kim Yong-beom’s proposal to extend the management cycle from 30 minutes to 2 hours mean?
Single-stock leveraged products rely on liquidity providers adjusting positions on a regular basis to shrink the gap between market price and net asset value. The current adjustment management cycle is about once every 30 minutes. Kim Yong-beom proposed reviewing whether the cycle can be extended to about 2 hours to spread out trading times, so that selling pressure on the underlying stocks does not concentrate in specific time windows, which could further push the price down.
What does the “triple surge” in South Korea’s housing market refer to?
“The triple surge” refers to the simultaneous increase in three things in South Korea’s real estate market: house sale prices, deposits for the full lease term (a one-time deposit called jeonse in Korean), and monthly rent. On July 19, 2026, Kim Yong-beom publicly apologized on the KBS program about this and said conditions are very severe.
