Single-Stock Leverage Products Under Regulatory Scrutiny

The Financial Commission accelerated the implementation of enhanced basic deposit requirements for single-stock leverage products, raising the initial deposit threshold from 10 million won to 30 million won. Investors must hold 30 million won in cash for new purchases or additional buys, compared to 10 million won for eligible securities. The deposit will now be recognized only after T+2 settlement and margin loans will no longer count toward the deposit. Launched in late May, these products saw their market cap surge from 44 trillion to 119 trillion won in just two months, raising concerns about volatility amplification as they now account for over half of Samsung Electronics and SK Hynix's market cap. Regulators warned of risk contagion if yields continue to double, prompting emergency policy shifts including deposit requirement tightening and advertising suspensions.