The CSOP SK Hynix Daily (2x) Leveraged Product experienced a sharp decline of 7.41% during intraday trading on Monday.
The significant drop comes as SK Hynix's approximately USD 280 billion ADR is tentatively scheduled to list on Nasdaq, with market expectations of arbitrage opportunities and valuation adjustments intensifying derivative price volatility.
Additionally, the Bank of Korea recently issued a warning that single-stock leveraged ETFs linked to Samsung Electronics and SK Hynix could exacerbate market concentration, amplify volatility, and reinforce one-sided capital flows. The ETF's scale has ballooned to USD 130 billion, making it the world's largest single-stock leveraged ETF, and as trading has become extremely crowded, banks have curtailed services due to risk exposure limits, pushing hedging costs from approximately 3% in March to above 10%, directly eroding fund performance.