South Korean Presidential Office to Investigate Causes of High Stock Market Volatility, Scope Not Limited to Leveraged ETFs

Odaily reported that Kim Yong-beom, head of the Policy Office of the South Korean Presidential Office, stated that in response to the recent sharp fluctuations in the South Korean stock market, he has requested the Financial Services Commission and the Financial Supervisory Service to investigate the structural factors that cause the South Korean market to be more volatile than other markets.

The scope of the investigation includes not only leveraged ETFs but will also cover the overall market structure. Kim Yong-beom pointed out that the South Korean stock market has its own structural issues, and equivalent fluctuations in the global market are often amplified in the South Korean market.

He stated that leveraged ETFs may exacerbate market volatility but are not the sole cause. Regulatory authorities will also focus on examining factors such as the proportion of derivatives trading and investor structure. (KBS)