Kosdaq surges over 30% after leveraged ETF access rules change
South Korea's Kosdaq index just shot up over 30% since late July, with a big jump of 6.8% on Monday alone.
The surge comes as investors move away from leveraged ETFs tied to chip giants like Samsung and SK Hynix, thanks to new rules making those funds harder to access.
The rally was so strong that the Korea Exchange even paused program buying for a bit.
Retail investors return to Kosdaq
With stricter rules on single-stock leveraged ETFs, retail investors are now piling into small and medium-sized companies, Kosdaq's specialty.
In August, Kosdaq was on track to outperform the main Kospi index by more than 20% points, and last week alone saw an 11% leap for Kosdaq while Kospi dropped.
As Park Wooyeol, global ETF analyst at Shinhan Securities, put it, "Volatility-loving retail investors who have moved to the single-stock leveraged ETFs are expected to make a comeback to the Kosdaq."