Introduction of Single Stock Leverage ETF in Korea and Regulatory Easing
The Financial Supervisory Commission of Korea has decided to permit the listing of single stock leverage ETFs involving blue-chip stocks like Samsung Electronics and SK Hynix. To facilitate this, amendments to the Capital Markets Act and Financial Investment Services and Capital Markets Act are underway, with plans to enhance investor protection measures. This policy is expected to play a crucial role in redirecting the capital flow back into the domestic market, which had been largely outward due to limited investment options.
In addition, the modifications aim to improve the existing diversification investment requirements, maintaining a leverage multiplier of ±2x. These changes intend to enhance the attractiveness of the domestic capital market and strengthen the investment environment by offering a variety of investment products. The newly introduced products will provide clear investment information to aid investors' understanding.
Furthermore, the Financial Supervisory Commission aims to enhance the diversity of the ETF market by expanding covered call dividend ETFs. Pursuing legal amendments for the introduction of 'completely active ETFs', there are also plans to advance the domestic stock and options markets. These changes are anticipated to boost the competitiveness of the capital market and satisfy the diverse needs of investors.
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