Korean exchanges are considering launching higher-risk ETFs to attract retail investors

PANews January 16 News, South Korea's major stock exchanges are in consultation with financial regulators to consider easing the ban on high-risk leveraged exchange-traded products (ETPs). Despite a historic surge in the domestic stock market, retail investor funds have still not flowed back into the domestic market. According to the CEO of Korea Exchange, the exchange is studying a gradual relaxation of related restrictions. Currently, these regulations prohibit high-risk products such as single-stock leveraged ETFs and funds that provide three times or more leverage exposure to indices. This move highlights the dilemma Korea faces: despite the benchmark Kospi index soaring 92% over the past year, investors continue to prefer the US market. Regulators pointed out that one of the main reasons for the weakening of the local currency is the large flow of domestic retail funds into the US stock market.

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