EP128. KOSPI Shock: How Two Stocks and Leveraged ETFs Shook an Entire Market [bsQFvhQOZ8D]
South Korea's KOSPI plunged about 9% on July 13, triggering a 20-minute market-wide trading halt. SK hynix and Samsung Electronics—together representing more than half of the Korean market—suffered major declines as geopolitical risk, an AI-chip reversal and crowded positioning collided. This episode investigates the market structure behind the shock: Korea's new 2× single-stock products, trillions of won in retail inflows, daily leverage resets, volatility compounding and the new wave of U.S. leveraged funds tied to SK hynix's Nasdaq ADR. Did leveraged ETFs cause the crash? The evidence points to a more nuanced conclusion: they were not the only driver, but their rebalancing mechanics may amplify an already concentrated and volatile market. Educational commentary only, not personal financial advice. Figures reflect the cited measurement periods and research cutoff of July 19, 2026. Disclaimer This report is provided for informational purposes only and does not constitute financial, investment, or professional advice. Viewers should conduct their own due diligence and consult with qualified financial and legal professionals before making any investment decisions. The information contained herein is based on research available at the time of making and may not be exhaustive or reflect the most current market developments.