Despite discussions about delaying the rollout of after-market ETF trading in the wake of single-stock leverage ETFs, the system is expected to go live as scheduled next month.

Starting next month, investors will be able to trade stocks and ETFs in the after-market from 4:00 PM to 8:00 PM.

Within the asset management industry, concerns are rising that trading ETFs in the after-market without proper infrastructure—such as the difficulty in calculating estimated net asset values (iNAVs) and the lack of creation, redemption, and cancellation infrastructure—could trigger a repeat of the volatility issues experienced with single-stock leverage ETFs.

According to the industry, the Korea Exchange (KRX) plans to soon ask asset management companies to submit a list of ETFs to be traded in the after-market.

This is part of preparatory work for the after-market trading from 4:00 PM to 8:00 PM, which the exchange will implement starting on the 14th of next month.

However, the heads of asset management firms reportedly agreed during a meeting on the 29th of last month that the launch of after-market ETF trading should be postponed.

Their stance was that trading stability could deteriorate if extended trading hours are introduced while heavy workloads for addressing single-stock leverage ETFs are still piling up.

The core issues pointed out by the industry involve the infrastructure for calculating estimated net asset values and handling creations and redemptions.

Basically, Koscom is responsible for calculating estimated net asset values, and Korea Securities Depository is in charge of creation and redemption infrastructure, but neither institution has finished building the relevant systems yet.

Some in the industry have gone as far as criticizing that it is "akin to forcing investors to trade at prices formed among themselves without any infrastructure to calculate estimated net asset values or handle creations and redemptions."

They warn that this could reignite market volatility sparked by single-stock leverage ETFs.

However, the exchange maintains that these concerns are exaggerated.

Its explanation is that after-market trading should simply be permitted only for products where liquidity providers (LPs) can sufficiently quote prices.

An official from the exchange explained, "Even for ETFs traded in the after-market, they can track the actual net asset value based on the estimated net asset value independently calculated by liquidity providers," adding, "We are merely asking firms to apply for ETF trading targets limited to issues where liquidity providers can be assigned."