🚨 BREAKING: Korean Equity Turbulence May Have Peaked After Historic Sell-Off
• South Korea's equity market may have passed the worst of its recent turbulence after a historic sell-off cleared leveraged positions and tighter regulations reduced activity in high-risk products.
• A Korean equity volatility index fell to a two-month low last week after reaching a record high in June, while forced liquidations reduced outstanding margin debt.
• New restrictions on leveraged ETFs have also sharply reduced trading volumes and assets linked to Samsung Electronics and SK Hynix.
• Morgan Stanley estimates that deleveraging is more than half complete, suggesting some of the forced selling pressure may have already run its course.
• The KOSPI remains nearly 40% below its June peak, while global funds have sold more than $100 billion of Korean equities year-to-date, weakening Korea's weighting in emerging-market portfolios.
$SKHY $KORU
• South Korea's equity market may have passed the worst of its recent turbulence after a historic sell-off cleared leveraged positions and tighter regulations reduced activity in high-risk products.
• A Korean equity volatility index fell to a two-month low last week after reaching a record high in June, while forced liquidations reduced outstanding margin debt.
• New restrictions on leveraged ETFs have also sharply reduced trading volumes and assets linked to Samsung Electronics and SK Hynix.
• Morgan Stanley estimates that deleveraging is more than half complete, suggesting some of the forced selling pressure may have already run its course.
• The KOSPI remains nearly 40% below its June peak, while global funds have sold more than $100 billion of Korean equities year-to-date, weakening Korea's weighting in emerging-market portfolios.
$SKHY $KORU