Investors in inverse funds are seeing gains this month as all top 10 performing ETFs for July are inverse products. These funds have capitalized on declines in the KOSPI futures and stocks like Samsung Electronics and SK Hynix.
This month, the performance of leveraged inverse products has been particularly notable. Leveraged inverse funds aim to deliver double the opposite return of their underlying index or stock on a daily basis.
According to the Korea Exchange on July 17, the 'SOL SK Hynix Futures Single Stock Inverse 2X' recorded a return of 54.08%, making it the top-performing ETF. Its trading volume reached approximately 34.7 trillion won, ranking second among all ETFs. The 'PLUS Samsung Electronics Futures Single Stock Inverse 2X' also performed well, achieving a return of 45.81% and placing fourth.
The remaining top positions were filled by products that inversely track the KOSPI 200 futures index. The 'TIGER 200 Futures Inverse 2X' and 'PLUS 200 Futures Inverse 2X' achieved returns of 47.22% and 46.76%, respectively, securing second and third place. They were followed by 'RISE 200 Futures Inverse 2X' (45.07%), 'KODEX 200 Futures Inverse 2X' (44.93%), and 'KIWOOM 200 Futures Inverse 2X' (44.78%).
Inverse products that track the KOSPI index's decline also yielded high returns. 'HANARO 200 Futures Inverse' and 'KIWOOM 200 Futures Inverse' rose by 25.73% and 23.49%, respectively, while 'TIGER Inverse' recorded a return of 22.90%.
Trading activity has heavily favored inverse products. The Korea Exchange reported that the 'KODEX 200 Futures Inverse 2X' was the most traded fund this month, with 1.366 billion shares exchanged. It was followed by 'SOL SK Hynix Futures Single Stock Inverse 2X' (361.3 million shares) and 'TIGER 200 Futures Inverse 2X' (157.4 million shares). The 'PLUS Samsung Electronics Futures Single Stock Inverse 2X' also made the top ranks with 23.2 million shares traded.
Other actively traded funds included 'KIWOOM 200 Futures Inverse 2X' (54.2 million shares), 'RISE 200 Futures Inverse 2X' (35.1 million shares), and 'PLUS 200 Futures Inverse 2X' (10.5 million shares). The 1X inverse product 'TIGER Inverse' (66.6 million shares), 'KIWOOM 200 Futures Inverse' (1.4 million shares), and 'HANARO 200 Futures Inverse' (380,000 shares) also ranked among the top 10 in trading volume.
Market analysts caution investors about the risks of repeatedly trading leveraged and inverse products. In volatile market conditions, losses from directional trading can accumulate quickly.
An industry insider stated, "The market has been exhibiting extreme volatility, with significant fluctuations occurring even within a single day. Investors should be particularly cautious with leveraged and inverse product investments, as the potential for being caught in volatility is high when trying to predict short-term directions."
* This article has been translated by AI.
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