SEOUL, June 22: Lee Chan-jin, head of South Korea's Financial Supervisory Service, expressed regret for hastily approving leveraged ETFs linked to prominent chip stocks Samsung Electronics and SK Hynix. He acknowledged risks and stated plans for stabilizing measures to mitigate volatility. These ETFs have driven retail investments to a record 60 trillion won. This surge is part of efforts to redirect local investors from U.S. markets during a significant bull run, where KOSPI index saw over 110% growth this year.
Despite the KOSPI's strong performance, the MSCI has withheld its upgrade to developed market status, an aspiration of President Lee Jae Myung's administration. Lee remarked that the nation will not rush the upgrade due to current market volatility and structural challenges. Recent MSCI reviews identified shortcomings in South Korea's market accessibility, including limited offshore currency options, while the government is enacting reforms to enhance foreign investment access.