South Korean university student's 5x leveraged stock trading once yielded a 15x return, but gains evaporated after market correction

Odaily Planet Daily News: Lee Seung-ho, a 24-year-old South Korean university student, used 5x leverage on a trading app, turning the 20 million won he saved during his military service into nearly 300 million won at its peak—approximately 15 times his initial capital. However, after severe volatility in the South Korean stock market in May, his brokerage firm triggered successive margin calls, wiping out all related gains within 4 weeks. His account balance ultimately fell below his initial investment.

Lee stated that high-leverage trading accelerated wealth growth, but maintaining a fully invested position ultimately led to losses. Data from the Korea Financial Investment Association shows that margin loan balances in the South Korean stock market rose to a record 38.63 trillion won on June 24, and remained at 34.37 trillion won as of July 15.

During the same period, the KOSPI index more than doubled over 6 months but subsequently suffered multiple declines of over 10% within weeks. South Korean regulators have announced a suspension of new listings for leveraged ETFs linked to individual stocks and stated they will strengthen risk management amid increased market volatility. (Reuters)