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Seoul moves up leveraged ETF deposit rule to July 31 amid volatility concerns
🇸🇬 Singapore /Economy & Trade

Seoul moves up leveraged ETF deposit rule to July 31 amid volatility concerns

From CNA · () English

Translated from English, summarized and contextualized by DistantNews.

At a glance

News Official statement New plan
  • South Korea's financial regulator is accelerating a rule requiring retail investors to deposit 30 million won for leveraged ETFs to July 31.
  • The measure aims to curb speculative trading by retail investors, following criticism that new domestic leveraged ETFs have increased market volatility.
  • The Financial Services Commission's decision brings the implementation forward from an earlier August target.

South Korea's financial regulator is fast-tracking new rules for leveraged exchange-traded funds (ETFs). The Financial Services Commission announced Friday it will require retail investors to deposit 30 million won ($20,437) to trade single-stock leveraged ETFs starting July 31. This deposit requirement was originally planned for August.

The regulator aims to curb speculative trading by retail investors. The approval of domestic single-stock leveraged ETFs, particularly those linked to major companies like Samsung Electronics and SK Hynix in late May, has drawn criticism for contributing to increased market volatility.

The accelerated implementation underscores the regulator's concern over market stability and its efforts to rein in potentially risky investment behaviors among individual investors.

DistantNews Editorial

Originally published by CNA in English. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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