Live Markets: South Korea's retail traders flock to foreign leveraged ETFs

Cushman & Wakefield

12/12/2023 16:10

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    SOUTH KOREA'S RETAIL TRADERS FLOCK TO FOREIGN LEVERAGED ETFS
   
    More than half of the top 50 overseas securities purchased
by Korean retail investors in November were ETFs listed in the
U.S, Japan and Hong Kong, according to research firm ETFGI.
    The number of ETFs on the list was down one from 29 in
October but up from 24 in September and 19 in August, its report
added. 
    There are about 10 million retail investors in South Korea,
according to Tellimer Research, with many joining during the
pandemic motivated by advices from social-media based investment
influencers.
    Over half of the ETFs that these Korean retail investors
flocked to provide leverage or inverse exposure, with the
Direxion Daily Semiconductor Bull 3X Shares ETF  SOXL.N  topping
the list with retail purchases of $821 million.
    The fund offering a three times magnified bet on U.S. chip
stocks has jumped 170% so far this year, supported by a sharp
rally in chipmakers like Nvidia  NVDA.O  on optimism around
artificial intelligence.
    Overall, the ETF has seen a sharp jump in net retail flows
since the start of the year, according to data by Vanda
Research.
 
    (Bansari Mayur Kamdar)    
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