9.99% Plunge on 'Black Tuesday'; 2x Bet on SK Hynix, Samsung Electronics Risks Up to 60% Daily Loss

South Korea's stock market experienced a historic crash on Tuesday, with the KOSPI index plunging 9.99% to close at 8,203.84. This dramatic fall, amounting to 910.71 points, represents the largest single-day point decrease in the index's history. The sharp decline was driven by massive sell-offs from foreign and institutional investors, who offloaded over 4 trillion won worth of stocks.

Key technology stocks bore the brunt of the sell-off. SK Hynix and Samsung Electronics suffered their most significant drops in approximately 18 years, a scale not seen since the 2008 global financial crisis. This severe downturn triggered multiple trading halts, including the activation of a sell-side "sidecar" mechanism 27 times this year alone, surpassing the 26 instances recorded during the 2008 crisis.

Individual investors, meanwhile, bought heavily, snapping up 8.5 trillion won in stocks, seemingly attempting to capitalize on the dip. However, their investments faced immediate and substantial losses, particularly those in leveraged Exchange Traded Funds (ETFs) tracking SK Hynix and Samsung Electronics. These ETFs, designed to amplify daily returns by a factor of two, saw average losses of around 25%, with some investors facing potential daily losses of up to 60%. The widespread fear among retail investors was palpable as the market experienced its "Black Tuesday."