South Korea's FSC Raises Single-Stock Leverage ETF Deposit Requirements to 30M Won on July 16

According to the Financial Services Commission on July 16, South Korea announced supplementary measures for single-stock leveraged ETFs and ETNs, raising minimum cash deposits for retail investors from 10 million won to 30 million won and increasing trading units from one share to 20 shares. The measures take effect in stages, with deposit hikes on August 5 and unit changes scheduled for November. The regulator estimated the affected product market cap would shrink from 11.9 trillion won to 4-5 trillion won.

On July 20, the first trading day after announcement, combined trading volume for Samsung Electronics and SK Hynix-related leverage and inverse products totaled 12.32 trillion won, comparable to 12.17 trillion won on the announcement date, raising concerns about the policy's effectiveness. The ruling Democratic Party subsequently requested enhanced market monitoring and additional measures if needed.