The scale of Korea’s margin financing and securities lending loans has risen to a historic record of about 26 billion US dollars, having doubled since the beginning of 2025.

However, if calculated based on the free-float market capitalization of Korean stocks, the share of margin loans has fallen to about 0.8%, the lowest level since the pandemic low in 2020. This shows that the surge in South Korea’s total stock market capitalization has significantly outpaced the growth of leveraged funds.
Meanwhile, during the most recent pullbacks, the proportion of forced liquidations on a single day once rose to 4% to 5% of the total outstanding margin financing loans, far higher than the normal level of about 1%.
This means that, because borrowers were unable to meet the additional margin requirements, brokers were forced to close 4% to 5% of all margin collateral positions within a single day.