South Korean Individual Investors Increase Leveraged ETF Investments
Despite rising volatility in the U.S. stock market, South Korean individual investors are increasingly investing in leveraged ETFs. In March, the proportion of ETFs in overseas stock transactions rose to approximately 58.1%, doubling compared to the end of last year. This trend is driven by optimistic expectations that the markets will rebound after a period of adjustment. Particularly, investments in ETFs related to Tesla and the semiconductor sector have surged due to declines in the S&P 500 and Nasdaq indices.
However, such investment strategies carry significant risks. Experts caution that leveraged and inverse ETFs could lead to substantial losses, advising investors to proceed with caution. The S&P 500 and Nasdaq indices have dropped by more than 10% and 14%, respectively, drawing attention to aggressive investment strategies. Although investors appear willing to withstand the volatility based on current data, this approach inherently involves higher risk.
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