South Korea's leveraged ETFs tied to chipmakers experienced outflows near $1 billion this month as investor fervor over the AI trade cooled and regulators stepped up measures to curb demand. Leveraged products tied to Samsung Electronics Co. recorded outflows of $381 million so far in August, while withdrawal amounted to $601 million for those tracking SK Hynix Inc. according to data compiled by Bloomberg Intelligence. That would mark the first monthly outflow since their late-May launch.

The cooling trend reflects shifting sentiment in the Korean semiconductor sector, with investors reducing exposure to high-risk leveraged products amid volatility. Regulatory scrutiny has intensified following the rapid growth of these instruments, prompting measures designed to temper speculative demand. Market analysts suggest the outflows signal a normalization phase after the AI-driven rally that fueled unprecedented inflows earlier this year.