Woofun AI reports that the Bank of Korea has cautioned against single-stock leveraged ETFs tied to Samsung Electronics and SK Hynix, citing potential for increased market concentration and volatility. The central bank noted that these two firms represent over half of South Korea's total market capitalization and trading volume, meaning expanded ETF investment could intensify one-sided trading flows. The Bank of Korea stated that shifts in corporate performance or market sentiment may trigger significant fund inflows or outflows, potentially widening retail investor losses during market corrections.

Additionally, ETF redemptions and portfolio rebalancing could further destabilize stock prices. The Bank of Korea intends to enhance monitoring of these products' impact on the financial system.