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

Odaily Planet Daily News Yoo Yong-beom, head of the policy office at the South Korean presidential office, stated that in response to the recent significant volatility in the South Korean stock market, the Financial Services Commission and the Financial Supervisory Service have been requested to investigate the structural factors causing the South Korean market to exhibit higher volatility than other markets.

The scope of the investigation will include not only leveraged ETFs but also cover the overall market structure. Yoo Yong-beom pointed out that the South Korean stock market has its own structural issues, and the same magnitude of global market fluctuations often gets 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 the investor structure. (KBS)