Trading volume of leveraged ETFs for individual stocks in South Korea has plummeted as new regulatory measures take effect.

After regulatory measures were taken in South Korea to curb speculative trading, the trading volume of leveraged ETFs linked to the country's two major chip giants has significantly shrunk. The largest single-stock leveraged ETF in South Korea, which is linked to the stock price performance of SK Hynix, saw its trading volume fall to 59 million shares on Monday, marking the lowest level since June 4. The trading volume of a smaller ETF linked to Samsung Electronics also dropped to its lowest level since its listing at the end of May. These leveraged ETF products had previously fueled significant volatility in the South Korean stock market. Last month, South Korean regulators introduced cooling measures, including raising the minimum cash balance requirements for investor accounts and temporarily banning the listing of new single-stock leveraged ETFs. These ETFs, which amplify returns through derivatives, had sparked a retail trading frenzy, making the South Korean stock market, with a market capitalization of $37 trillion, one of the most volatile markets in the world.