Currently, the political circles are pointing fingers at single-stock leveraged ETFs as the root cause of all these problems and threatening to take extraordinary measures.
Let's not argue anymore about whether that view is right or wrong,
I have had a question for a long time.
Stock market participants are divided into individuals/foreigners/institutions as we see in stock apps.
A while ago, I asked an AI if there are any other stock markets besides ours that update the trading status of supply and demand subjects in real time like this, and of course, there is no such concept in the US market, and globally, as far as I remember, there are only a few other markets besides ours that show trading trends as data.
I want to raise an issue about whether these three players on the Korean stock market are on equal footing...
For ordinary individuals who are not professional investors, the only way to participate in the stock market is (mostly, semi-compulsorily) long positions (buying).
On the other hand, institutions and foreigners have a variety of weapons at their disposal, such as futures, options, short selling, program trading, quant, HFT, etc.
In other words, they have various means to make profits regardless of whether stock prices rise, fall, or move sideways.
On the other hand, ordinary individual investors only have three options when the price falls after buying in anticipation of a price increase: 1) cut their losses, 2) hold for the long term, or 3) wait and see.
In the meantime, a product called single-stock leveraged ETF is launched.
Is there a rule that says individual investors shouldn't have the desire to maximize profits in a short period of time + the desire to respond in case of a decline? Or is it a big sin to trade leveraged products following such desires?
At this point, when the Blue House is stepping forward to discuss single-stock leveraged ETFs, no politician mentions the asymmetry and unfairness of this market. They are either ignorant or turning a blind eye.
Most importantly, it seems that there are no so-called stock experts or politicians who properly understand the structural mechanism by which single-stock leveraged ETF products work.
Is a single-stock leveraged ETF the culprit of the market crash? Institutions or foreigners who trade futures/options will probably scoff.
Are individual investors in the US really so much more honest, innocent, and good that they don't use leverage or hedging and just trade honestly with their own stocks?
Starting this week (probably Wednesday?), option trading for SK Hynix ADR will be available.
So, get ready.
That's it.
