Korea Investment Trust CEO Urges Halt to Single-Stock Leveraged ETF Investing on July 20

According to Yonhapinfomax reporting on July 20, Bae Jae-kyou, CEO of Korea Investment Trust Management, publicly urged investors to stop investing in single-stock leveraged ETFs, stating that even if underlying stocks return to original prices, the ETF value may not recover due to compounding effects during volatility.

However, fund managers at other asset management firms overseeing these products, which were launched by eight operators on May 27, disagreed with the CEO's assessment. They argued the products themselves have no structural defects, with one manager noting that Korea's relatively shallow market liquidity has amplified volatility effects compared to the U.S. market. The managers emphasized investors should understand the products' short-term trading purpose before investing.