The Bank of Korea issued a public warning over single‑stock leveraged ETFs tied to Samsung Electronics and SK Hynix. Officials say the funds could deepen concentration and amplify volatility, contrary to their stated goal of broadening the market. The warning follows months of rapid growth in the semiconductor sector.

Samsung and SK Hynix now command more than half of KOSPI’s market cap. Their combined weight rose from 36.1% at year‑end to 55.3% on June 24, while trading value share jumped from 27.9% to 63.5%. That concentration heightens price swings and risks for retail traders.

In a correction, losses for individual investors could surge, and daily rebalancing of leveraged ETFs might trigger sharper movements. The BOK warned that margin trading and cash‑futures arbitrage could amplify volatility. Strong earnings alone cannot offset the amplified risk that leveraged play injects significantly and.

The BOK plans to tighten monitoring and review leveraged ETFs, and will coordinate with regulators to mitigate systemic risks. It also noted that past reports had downplayed volatility; the new stance reflects the growing impact of concentrated, high‑leverage positions. Investors face a more volatile environment.