Southern 2x Leveraged SK Hynix (07709) opened over 8% lower, falling 8.47% to HKD 34.8 as of writing, with trading volume reaching HKD 106 million.

On the news front, SK hynix released its second-quarter results, reporting sales of KRW 79.32 trillion, a 257% year-over-year increase but below the expected KRW 84 trillion. Operating profit reached KRW 60.54 trillion, setting another record high with a 557% year-over-year surge, surpassing the full-year 2025 figure, yet still falling short of the anticipated KRW 64.22 trillion. Net profit soared 1242% to KRW 93.92 trillion.

Notably, the Hong Kong Securities and Futures Commission recently updated the regulatory framework for leveraged and inverse products in Hong Kong. Analysts indicate that the core of the new rules is a flexible leverage mechanism. It requires that individual stock leveraged products, whose capacity is constrained by market liquidity and swap exposure, can reduce their leverage ratio daily within a 2x/-2x upper limit. This is accompanied by mandatory disclosure, renaming, and other regulatory requirements.

On July 27, CSOP Asset Management announced that its 2x leveraged and inverse products linked to individual stocks such as Nvidia, SK hynix, Samsung, and Tesla will officially switch to a flexible leverage structure on August 3. During extreme market conditions, the leverage ratio could be reduced to as low as 1.1x. This move has sparked significant controversy among investors.