Report: Korean brokerages plan to tighten investment rules for single-stock leveraged ETFs; the minimum margin requirement may be tightened or increased by five times.

Reportedly, the South Korean securities industry has agreed to tighten investor protection rules for single-stock leveraged ETF products. On Tuesday, the Korea Financial Investment Association convened an emergency meeting with the CEOs of major securities firms to assess the leveraged ETF market tracking Samsung Electronics and SK Hynix, and to discuss response measures. The participating institutions, in principle, agreed to raise the minimum margin requirement to curb retail investors from overusing leverage. One option under discussion is to increase the minimum margin threshold from 10 million won to 50 million won. The institutions also agreed to provide more tailored risk warnings based on investors’ age and portfolio conditions, and to strengthen investor education to help them better understand the structure and risks of such products.

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