🪂 Korean leverage can move the whole planet—two Samsung and SK Hynix stocks drive 80% of trading volume in Korean equities

Today’s Korea versus the 2015 China stock crash—who has more leverage? Who has higher margin?

Currently, Korea’s retail margin financing balance has reached a record high of 38.6 trillion won. Leverage ETFs total 14 trillion won, accounting for 0.6% of the total market cap of Korean stocks—lower than China’s 5%.

But, however, however— in Korea, things are worse. They only have two stocks: Samsung and SK Hynix.

Those two stocks alone account for 51% of Korea’s stock market trading value. Adding 18 leveraged ETFs brings it to a terrifying 83%.

In simple terms, Korea is a nation-wide futures contract trading market. A 2x ETF is even scarier than contracts—it uses same-day rebalancing. When the market drops, on the same day investors are forced to sell passively, and retail traders have no way to set stop-loss orders.

A stampede spiral forms: ETF sells → stock price falls → margin forced liquidation → stock price keeps falling → ETF keeps selling.

When everyone buys in the same direction, the real risk isn’t how bad the “bad news” is—it’s that once the first batch of people are forced to sell, there’s basically no counterparty left in the market.