South Korean lawmaker warns KOSPI "has become a casino," calling for delisting of leveraged ETFs

Odaily Planet Daily News A South Korean lawmaker's concerns over the risks of single-stock leveraged ETFs are growing, with an opposition party lawmaker calling for the delisting of such products. On Monday, Ahn Cheol-soo, a lawmaker from the conservative People Power Party and former presidential candidate, took to social media to call for strong corrective measures, including delisting, against Korean leveraged ETFs tracking Samsung Electronics and SK Hynix.

He wrote that the Korea Composite Stock Price Index (KOSPI) "has become a casino" and that such products are "a complete policy failure, devouring trillions of won in corporate value and national wealth every day." His remarks have intensified concerns among policymakers and investors regarding the risks of these ETFs. Such products aim to deliver twice the return of the underlying stock, and their mechanized rebalancing process forces them to buy more when prices rise and sell more when prices fall, potentially amplifying market volatility. (Jin Shi)