◆Major News from Ajou Economics
▷"If KOSPI Hits 12,000, Will Inverse ETFs Drop to Zero?"... Inverse ETFs Face Delisting Risk Amid KOSPI Rally
- According to the Korea Exchange on May 13, prices of KOSPI 200 leveraged ETFs, including KODEX 200 Futures Inverse 2X, TIGER 200 Futures Inverse 2X, RISE 200 Futures Inverse 2X, and KIWOOM 200 Futures Inverse 2X, have all fallen to the 100 won range. Only PLUS 200 Futures Inverse 2X remains above 200 won. - Following KOSPI's historic breach of 7,000 points on May 6, the index surged to nearly 7,999 points on May 12, continuing its strong upward trend. This rapid increase has led to significant losses for leveraged ETFs betting on a decline in the index. A year ago, these products had total net assets exceeding 5 billion won, but many are now nearing delisting criteria, except for KODEX and TIGER products. - Industry experts suggest that if the KOSPI's upward trend continues for an extended period, the prices of leveraged ETFs could theoretically approach zero due to the compounding negative effects characteristic of inverse leveraged ETFs during rising market conditions. - However, asset management firms are not currently considering delisting, citing substantial demand from individual investors. - Market analysts attribute the heightened caution regarding KOSPI's overheating to factors such as Middle East risks, valuation pressures, and the 'Sell in May' sentiment. They explain that funds are flowing into leveraged ETFs as investors bet on a potential correction following the recent rapid rise.
◆Key Reports
▷Domestic Risks Ease Amid Hopes for U.S.-China Talks, KOSPI Could Reach 8,000 with Just 2% Gain [Daishin Securities]
- On May 13, the semiconductor sector rebounded just one day after experiencing a decline due to domestic risks, contributing to a reversal in KOSPI's fortunes. The ongoing labor dispute at Samsung Electronics remains a concern, but government officials have assured that a strike is unacceptable and that they will support negotiations to resolve the issue. - The previously raised issue of national dividend payments has been dismissed as a personal opinion, leading to a calming of domestic risks. Despite foreign investors continuing to sell large-cap semiconductor stocks for five consecutive trading days, the influx of bargain-hunting by institutions and individual investors has driven the semiconductor sector's recovery, supporting the index's rise. - A high-level meeting is scheduled for May 14 in Beijing between U.S. Treasury Secretary Scott P. Hensarling and Chinese Vice Premier He Lifeng to coordinate the agenda for a summit between President Donald Trump and Chinese President Xi Jinping, who is expected to request greater access to the Chinese market. The anticipated attendance of Jensen Huang, CEO of NVIDIA, who was previously rumored to be absent, has further fueled market optimism.
◆Major Announcements After Market Close (May 13)
▷Hyper Corporation Announces 20 Billion Won Shareholder Allocation Capital Increase
▷HLB Pharmaceuticals Announces 120 Billion Won Shareholder Allocation Capital Increase
▷Samyang Foods Reports Record Q1 Earnings Driven by 'Fire Noodle' Craze, Operating Profit Up 32%
▷Korea Electric Power Corporation Reports Q1 Operating Profit of 3.7842 Trillion Won, Up 0.8% Year-on-Year
▷Emart Reports Q1 Operating Profit of 178.3 Billion Won, Up 11.9% Year-on-Year
▷CJ Logistics Reports Q1 Operating Profit of 92.1 Billion Won, Up 7.9% Year-on-Year
◆Fund Trends (As of May 12, Excluding ETFs)
▷Domestic Equity: 9.6 Billion Won
▷Overseas Equity: -41.2 Billion Won
◆Key Schedule for Today (May 14)
▷UK: Q1 GDP Growth Rate, Industrial Production (March)
▷US: Retail Sales (April)
* This article has been translated by AI.
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