Strategist: Leveraged ETFs for Samsung Electronics and SK Hynix Face Reality Check

Odaily News According to a report released by derivatives and quantitative strategist Goderts Schneider on Smartkarma, the 2x leveraged exchange-traded funds (ETFs) tracking Samsung Electronics and SK Hynix would need to rise by approximately 33% to return to their June 22 levels, implying that the underlying stocks need to rebound by about 16.5%.

The report states that on Tuesday, shares of both Samsung Electronics and SK Hynix fell by double digits, causing the related ETF prices to drop nearly 25%. Among them, the Samsung 2x leveraged ETF has fallen 5.4% cumulatively since its launch on May 27. He noted that South Korea's newly launched single-stock 2x leveraged ETFs can enhance returns in trending markets but can quickly erode value during periods of high market volatility, making them most suitable for short-term tactical momentum investing. (Jinshi)