Korean brokerages discuss raising the minimum deposit requirement for leveraged ETFs in chip stocks

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BlockBeats message, July 15: The Korea Financial Investment Association said that the CEOs of 10 major asset management companies in the country discussed investor protection measures for investors for products that focus on individual stocks with leveraged ETFs, including raising minimum deposit requirements and spreading out rebalancing trade times.

According to a statement released by the association, the participants agreed that it is necessary to raise the minimum deposit requirement for investing in such leveraged products from the current level of 10 million won (US$6,714).

They also pointed out that the role of liquidity providers as market stabilizers needs to be strengthened. Citing data from the Korea Capital Market Research Institute, the Korea Financial Investment Association said that since the launch of the related leveraged ETFs, the estimated stock trading volume required for daily rebalancing is about 700 billion to 2.1 trillion won.

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