Woofun AI data shows that South Korean margin lending for stock speculation has reached a historical peak of approximately $26 billion, representing a doubling since early 2025. Despite this surge, margin loans constitute only about 0.8% of the country's free float market capitalization, marking the lowest ratio since the 2020 pandemic lows due to faster growth in total market value.

Recent market declines have triggered a sharp increase in forced selling, with daily liquidations rising to 4-5% of total outstanding margin loans, significantly above the typical 1% average. This elevated liquidation rate stems from leveraged investors failing to meet additional margin calls, forcing brokers to close positions rapidly and exacerbating volatility in the South Korean equity market.