[Anchor]

Individual investors who put their money into single-stock leverage products suffered over KRW 6.3 trillion in losses just two and a half months after their launch. Notably, investors aged 70 and older recorded losses of roughly KRW 30 million per account, and the actual figures may have grown even larger since then.

Reporter Min Gyeongho has the details.

[Reporter]

Single-stock leverage products made their surprise debut in late May as the won-dollar exchange rate soared past KRW 1,500.

At the time, expectations were high that the products would broaden consumer choices, prevent capital outflow, and help stabilize the exchange rate.

However, as shares of Samsung Electronics and SK hynix—which account for half of the KOSPI market capitalization—fluctuated wildly, trading at 2x leverage drew heavy criticism for further amplifying swings in the KOSPI index.

[Kim Jae-sub / Member, National Policy Committee, People Power Party (October 19): "We had a Black Monday, Tuesday, Wednesday, Thursday, and Friday. Do you believe this was caused by the launch of single-stock leverage ETFs?"]

[Lee Chan-jin / Governor, Financial Supervisory Service (October 19): "I believe that played a part as one of the causes."]

An analysis of data from 10 major securities firms by the Financial Supervisory Service showed that retail investors who invested in single-stock leverage products lost more than KRW 6.3 trillion from their launch through August 14.

By that date, when leverage ETF prices had plummeted around 60% from their peaks, realized losses from sales already surpassed KRW 2.3 trillion.

Unrealized losses visible in accounts, though unsold, neared KRW 4 trillion.

While investors in their 40s suffered the largest total losses exceeding KRW 2.0 trillion, those aged 70 and older logged an average loss of about KRW 30 million per account—more than double the overall average.

Excluding those under 20, investors in their 70s had the lowest rate of locking in losses through actual sales.

Compared to late July, realized losses from sales increased in August while unrealized losses decreased, suggesting that so-called stop-loss selling—selling at a loss—became more active.

With recent prices of leverage ETFs falling another 30% to 40% below the August 14 cutoff, total losses are likely to have expanded further.

(Video by Lim Yeojin)