华尔街之狼们，别再猛冲2x、3x海力士了

Original: Odaily Planet Daily (@OdailyChina)

Author: Azuma (@azuma_eth)

If we are to identify the most talked-about concept in global capital markets this year, the answer must be memory storage.

With the continuous advancement of AI infrastructure construction, HBM (High Bandwidth Memory) is in short supply. The three major memory manufacturers—SK Hynix, Samsung, and Micron—have become the focus of market attention. The influx of capital has driven their stock prices to soar rapidly. Even after a significant correction recently, their year-to-date gains remain quite remarkable.

When a stock keeps rising, there will always be people in the market who feel it "isn't rising fast enough." Consequently, a previously niche product class is rapidly entering investors' view: Single Stock Leveraged ETFs. Unlike traditional ETFs that track a basket of stocks or indices, these products track only a single stock and use financial derivatives such as swaps and futures to amplify the stock's daily price movement by 2x or even 3x. In other words, if the underlying stock rises 10% on a given day, the corresponding 2x leveraged ETF would theoretically rise about 20%; conversely, if the stock falls 10%, the product would also lose about 20%.

For this reason, single stock leveraged ETFs are becoming a new tool for increasingly aggressive investors betting on popular AI stocks. This year, as hot money hoping to leverage AI and memory storage trends to amplify returns continues to pour in, the scale of single stock leveraged ETFs launched around popular AI concept companies like SK Hynix has also been expanding.

However, what many investors overlook is that on the other side of amplified returns, risks are also amplified by the same multiple—in extreme market conditions, the underlying stock might still recover, but a single stock leveraged ETF may not even get a chance to wait for that rebound.

A Vivid Example: The Delisting Path of a 2x Leveraged ETF

Don't think this is an exaggeration. A case that occurred during US stock trading the night before last sufficiently reveals how dangerous single stock leveraged ETFs can be.

The above image shows the recent stock price trend of US electric vehicle maker Lucid (LCID). On July 14 local time, rumors suddenly emerged during US trading hours that Lucid was considering filing for bankruptcy protection. Affected by this negative news, LCID's stock price once plummeted 57%, triggering multiple trading halts during the session, marking its largest intraday decline since listing.

However, the plot quickly reversed. Lucid subsequently issued a statement confirming that the company had indeed hired consulting firm AlixPartners to conduct a comprehensive review of its operations to optimize operations, cut costs, and advance the development of new models. It stated that the rumors about filing for bankruptcy were "completely false." Lucid also emphasized that it currently has sufficient liquidity to sustain operations until next year, and AlixPartners is only responsible for operational optimization work, having not made any bankruptcy recommendations to management or the board.

With Lucid's emergency denial, market sentiment recovered rapidly. Lucid's stock price rebounded from its intraday low, eventually closing with a narrowed loss of about 16%. For investors holding Lucid stock, this was more like a thrilling "roller coaster ride."

However, for another group of investors, the story ended at the moment the crash occurred.

During the sharp decline of Lucid, the 2x leveraged ETF tracking its stock performance—the GraniteShares 2x Long LCID Daily ETF (LCDL)—was liquidated directly. The fund manager GraniteShares subsequently issued an announcement confirming that the fund had liquidated all its LCID holdings that day, and because its net asset value had turned negative, it would officially initiate delisting procedures.

This means that when Lucid's stock price subsequently rebounded quickly, this ETF had no positions left to restore its net value. For all holders of LCDL, there was no longer an opportunity to participate in LCID's subsequent upward movement.

This is the biggest difference between single stock leveraged ETFs and ordinary stocks. Even if a stock plummets, as long as the company still exists, investors have a chance to wait for a rebound. However, once a single stock leveraged ETF "triggers its death mechanism" during extreme volatility, even if the underlying stock subsequently recovers its losses, investors are very likely never to see that day.

Rising Social Issues: South Korea's Government Begins to Fear

The delisting of LCDL is by no means an isolated case. In fact, with the rapid adoption of single stock leveraged ETFs on popular AI stocks, regulators have begun to reassess the systemic risks these products may pose.

Among them, South Korea's stance is particularly representative.

In mid-July, according to The Korea Times, South Korea's four major financial authorities—the Ministry of Economy and Finance, the Financial Services Commission, the Financial Supervisory Service, and the Bank of Korea—planned to hold a special meeting under the government's macroeconomic and financial issues coordination mechanism (F4) to discuss the risks of single stock leveraged ETFs and regulatory measures. Discussion directions within the market include raising margin requirements, limiting daily price fluctuation ranges, and reducing leverage multiples.

In recent years, as South Korean retail investors have continued to flood into the stock market, the AI trend has almost evolved into a nationwide investment frenzy. Heavily weighted stocks like Samsung Electronics and SK Hynix have become focal points for capital chasing, while leveraged ETFs launched around these stocks have further amplified market sentiment and stock price volatility. The regulators' concern is that as more and more investors begin to use high-leverage products to chase popular stocks, the impact of a single violent fluctuation is no longer just a change in numbers on investment accounts, but could potentially evolve into a social issue.

As the memory storage concept faces downward pressure, extreme events have occurred one after another in South Korea's capital market. On the one hand, rumors of suicide incidents caused by failed stock investments have appeared on social media. The Chosun Ilbo also reported yesterday that a YouTuber in Busan who ran a stock investment channel was repeatedly stabbed on the street by a man in his 20s. Preliminary police investigations indicate that the suspect was a subscriber to the channel, who harbored resentment and carried out the attack after suffering significant losses from following the blogger's stock recommendations.

Although the aforementioned incidents were not directly caused by single stock leveraged ETFs, the signal they send to regulators is highly consistent—when high-risk investment tools continuously lower the barrier to participation and overlap with dissemination channels like social media and live-streamed stock recommendations, financial risks can ultimately spill over into social risks.

For the South Korean government, this is the most frightening thing.