South Korea’s top financial regulator is preparing to introduce additional measures to dampen demand for single-stock leveraged exchange-traded funds (ETFs).
The Financial Services Commission (FSS) indicated that new rules are under consideration as authorities seek to cool speculative trading in these high-risk instruments, which have seen surging interest from retail investors.
This development follows a recent regulatory move to increase the minimum deposit requirement for single-stock leveraged ETFs, a step designed to raise the barrier to entry for smaller accounts.
The FSS has identified these products as a source of market volatility, particularly given their sensitivity to the price swings of individual underlying stocks.
The upcoming measures are expected to further restrict access or impose stricter trading conditions.
The focus on single-stock leveraged ETFs reflects broader concerns about retail investor behavior in South Korea’s equity markets.