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South Korea’s Kospi volatility worsens as leveraged ETFs turbocharge moves

The Kospi has logged 33 days with at least 5% swings in 2026, and Goldman Sachs estimates leveraged products could still drive 17% of SK Hynix trading volume on extreme moves.

Reported · Written up by our desk · Emerging Markets

LiveMint Markets argues South Korea’s stock market is becoming less investable due to sharp, fast swings in the Kospi, which has fallen nearly 40% in just 27 trading days, the outlet notes.

The piece cites a contrast in volatility versus other Asian benchmarks, saying the Kospi has seen 33 days with daily moves of at least 5% in 2026, compared with four for the Nikkei 225 and zero for the Hang Seng.

It attributes a major share of that volatility to the outsized influence of leveraged exchange traded funds, saying these products were turbocharged after the government approved single stock leveraged ETF launches in late May and that daily mechanical rebalancing can amplify price action.

According to Goldman Sachs Group Inc. estimates cited by LiveMint Markets, at the Kospi’s June peak a 5% move in SK Hynix could trigger rebalancing flows equal to 40% of the stock’s average daily volume, and leveraged products could still account for 17% of trading during days of extreme price moves.

Latest closeNikkei 225 61,867.43 ▲0.7%|Hang Seng 25,858.88 ▲0.2%|Kospi 5,593.56 ▼1.2%

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