South Korea Rejects Forced Delisting of Leveraged ETFs, Implements Margin and Trading Unit Controls

According to KBS, South Korea's presidential policy office chief Kim Yong-beom rejected forced delisting of leveraged single-stock ETFs on July 19, citing deep investor participation and over 10 trillion Korean won in product scale. He noted that mandatory delisting would cause significant market disruption and force absorption of sell-off pressure. Kim confirmed that recent regulatory measures—including raising margin requirements to 30 million Korean won in cash and setting a minimum 20-share trading unit—have addressed market feedback and should substantially mitigate side effects.

Kim also stated that leveraged products amplify market impact during downturns, requiring further coordination between regulators, asset managers, and brokers to minimize disruption during specific periods and narrow the deviation between ETF net value and actual closing prices.