South Korea Raises Single-Stock Leveraged ETF Trading Requirements to 3 Billion Won Starting July 31

According to South Korea's Financial Services Commission (FSC), individual investors must maintain at least 3 billion won in cash as collateral to purchase or increase holdings in single-stock leveraged ETFs and ETNs starting July 31. The measure applies to products listed on Korean and overseas exchanges. The collateral requirement has been raised from 10 million won previously required; only cash assets now qualify, with securities no longer accepted. Additionally, proceeds from stock sales must settle by T+2 before counting toward the collateral requirement.

The FSC implemented this tightening after single-stock leveraged product market capitalization surged from 4.4 trillion won on May 27 to 11.9 trillion won by July 15, amid heightened volatility in semiconductor stocks. The authority previously suspended new listings of such products on July 16 and restricted related advertisements.