A leveraged exchange-traded fund tracking SK Hynix Inc. jumped 50% on Monday even as the chipmaker's shares tumbled nearly 8%, exposing a major pricing anomaly. The KIM ACE SK Hynix Single Stock Leverage ETF closed at a record 30,000 won, defying its mandate to deliver twice the daily move of the underlying stock.

The fund house blamed insufficient liquidity in its market-making system for the disconnect, which occurred amid broader weakness in South Korean memory-chip stocks. Samsung Electronics and SK Hynix both fell sharply as investors dumped semiconductor shares amid growing concerns about demand and pricing pressures.

Other leveraged ETFs focused on SK Hynix performed normally, closing lower in line with expected outcomes. This isolated incident highlights the risks of single-stock leveraged products during volatile trading sessions when market makers struggle to maintain fair pricing.

The episode serves as a stark reminder that leveraged ETFs can behave unpredictably during market stress, potentially creating arbitrage opportunities while trapping retail investors who misunderstand the mechanics of these complex instruments.