South Korea Plans to Introduce "Emergency Measure Authority" to Lower Single-Stock Leveraged ETF Multipliers

TechFlow News, August 02, according to Yonhap News Agency, South Korea's Financial Services Commission is jointly advancing amendments to the "Capital Markets Act" with the Financial Supervisory Service, planning to introduce "emergency measure powers" that allow financial authorities, in market emergency situations, to temporarily adjust the leverage ratio of single-stock leveraged ETF/ETN products from the current 2x down to 1.5x or 1x without requiring a vote from the beneficiary meeting. FSC Chairman Lee Bu-kun previously stated at the plenary session of the National Assembly's Policy Committee that lowering the ratio has a certain effect on alleviating market volatility. Meanwhile, authorities are also studying supporting regulatory measures such as setting leverage investment limits (capped at 20% of total investment), mandating simulated trading, and further increasing the basic margin based on the current 30 million won.