SK Hynix surges 13%, while 2x leveraged ETF experiences a "reverse swing" and plummets 40%

Odaily Planet Daily News The leveraged ETF tracking chip giant SK Hynix, "KIM ACE SK Hynix Individual Stock Leveraged ETF," plunged as much as 40% shortly after the market opened on Tuesday (with the latest decline narrowing to approximately 30%), while SK Hynix's stock price surged over 13% during the same period.

Previously, the ETF showed abnormal volatility on Monday, surging 50% at the close while its underlying tracked stock, SK Hynix, fell nearly 8%. The two consecutive days of "reverse swings" have intensified market scrutiny of the ETF's manager, Korea Investment Management Co. The company stated that the initial anomaly in the $37 million fund on Monday stemmed from a lack of liquidity.

Jung In Yun, CEO of Fibonacci Asset Management, said, "While such price dislocations are rare, they are not unprecedented. ETFs typically rely on market makers to ensure prices align with the underlying assets. However, during Monday's closing auction phase, these safeguards can weaken, especially in niche products with limited trading volume." (Aastocks)