South Korean financial authorities are set to meet on Thursday to discuss potential measures addressing risks linked to single-stock leveraged exchange-traded funds (ETFs). The meeting is expected to be held under the government’s macroeconomic and financial issues consultative group, the F4, which brings together officials from the Ministry of Economy and Finance, the Financial Services Commission, the Financial Supervisory Service and the Bank of Korea.
The decision follows weeks of heightened market volatility in which single-stock leveraged ETFs are under increasing scrutiny from regulators and market participants. Critics say the products can amplify price swings and act as a significant factor behind sharp movements in the Korean stock market.
The concerns intensified after the KOSPI fell more than 8% during Monday’s trading session, which triggered the market’s seventh circuit breaker of the year. In recent remarks to the National Assembly, Deputy Prime Minister and Finance Minister Koo Yun-cheol said authorities were considering responses, and the upcoming F4 meeting is intended to further review possible policy options.
