South Korea's Regulators Rejected Industry Plea to Expand Single-Stock Leverage Products Beyond Samsung, SK Hynix

According to the financial investment industry, on July 7, South Korea's regulators rejected industry recommendations to expand single-stock leverage products beyond Samsung Electronics and SK Hynix. The Financial Investment Association had surveyed major domestic asset managers since February and found that most managers, excluding Samsung Asset Management and Mirae Asset, recommended allowing leverage products on top KOSPI and KOSDAQ stocks to reduce market concentration. However, authorities approved only the two semiconductor giants to minimize market volatility. Data shows the concentrated approval backfired: SK Hynix leverage product trading volume reached $19 billion, or 4.2 times the underlying stock's $4.47 billion daily turnover. Samsung Electronics leverage products similarly dwarfed its underlying stock trading volume, amplifying market swings across the KOSPI.
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