FSC Chief Says South Korea Will Consider More Steps to Curb Single-Stock Leveraged ETF Demand

According to Yonhap, South Korea's chief financial regulator said it will consider additional measures to cool demand for recently introduced single-stock leveraged exchange-traded funds (ETFs), which have been blamed for sharper stock-market volatility. Lee Eog-weon, chairman of the Financial Services Commission (FSC), said at a meeting with local brokerages and asset managers that he will review the impact of a policy raising the minimum cash deposit for investment in single-stock leveraged ETFs to 30 million won ($20,400), effective Friday. The government moved up the deposit rule by several weeks to help stabilize the market and protect investors amid heightened volatility. President Lee Jae Myung has called for swift implementation of such measures to calm the market. Lee also said regulators will prepare further steps if demand does not ease enough, including a possible cap that would limit such ETF investments to 20% or less of an individual's total financial investment portfolio. Single-stock leveraged ETFs tied to Samsung Electronics and SK hynix, introduced in May, have been widely seen as a key driver of recent volatility in the domestic stock market.