'After Leverage, Inverse?'... A Daily 4 Trillion Won Bet on SK hynix's Decline

[Financial News] As the financial authorities announced regulations on single-stock leveraged exchange-traded funds (ETFs), trading in inverse ETFs that bet on declines is surging. With some products seeing daily trading value more than 19 times their market capitalization, analysts say inverse ETFs are emerging alongside leveraged products as a vehicle for short-term trading.
According to the Korea Exchange on the 20th, trading in SOL SK hynix Futures Single Stock Inverse 2X reached 391.95 billion won that day, the second-highest in the entire ETF market. Its market capitalization stood at 204.8 billion won, meaning daily trading volume was about 19.1 times its market value. The same shares were repeatedly traded throughout the day, suggesting intense ultra-short-term turnover.
The top spot in trading value went to KODEX SK Hynix Single Stock Leverage ETF, with 428.99 billion won. Other high-volume products included KODEX Leverage ETF at 177.69 billion won, TIGER SK hynix Single Stock Leverage ETF at 173.97 billion won, and KODEX Samsung Electronics Single Stock Leverage ETF at 126.98 billion won. Leveraged and inverse products accounted for a large share of the ETFs with the highest trading values.
As SK hynix shares fell on the day, inverse ETFs posted strong gains. SOL SK hynix Futures Single Stock Inverse 2X and PLUS Samsung Electronics Futures Single-Stock Inverse 2X rose 10.40% and 9.72%, respectively, while KODEX SK Hynix Single Stock Leverage ETF (-9.15%), KODEX Samsung Electronics Single Stock Leverage ETF (-8.98%), and TIGER SK hynix Single Stock Leverage ETF (-8.73%) declined. In effect, short-term money betting on both gains and losses was active at the same time.
Turnover was especially striking in inverse ETFs. Trading value for SOL SK hynix Futures Single Stock Inverse 2X was about 19.1 times its market capitalization, while KODEX SK Hynix Single Stock Leverage ETF was about 1.23 times and TIGER SK hynix Single Stock Leverage ETF about 0.95 times. This suggests that ultra-short-term turnover was concentrated in inverse products.
By investor type, individuals and foreigners were net buyers across the ETF market. Individuals bought a net 585.5 billion won, foreigners 168.6 billion won, while institutions sold a net 783.3 billion won.
A securities industry official said, "There is also considerable hedging demand in inverse ETFs, but the fact that trading value exceeded market capitalization by 19 times means the share of short-term trading was quite high." The official added, "It will be necessary to keep a close watch on which products short-term funds move into going forward."


[email protected] Choi Du-seon Reporter