South Korean Retail Investors Face $4.8 Billion in Leveraged ETP Losses

South Korean retail investors posted about $4.8 billion in losses on leveraged exchange-traded products tied to Samsung Electronics and SK Hynix, with investors in their 40s suffering the largest aggregate loss.

The tally covers May 27 through Aug. 14 across accounts at 10 Korean brokerages. It combines losses on completed trades with declines in the value of positions investors still held at the end of the period. Those paper losses made up the larger share of the total.

Investors in their 40s recorded the largest aggregate loss among age groups across 165,200 accounts. Those in their 50s ranked next, with 158,000 accounts, followed by investors in their 30s with 117,300. People 70 and older lost an average of about 29.94 million won per account.

The products track individual stocks and use leverage to magnify their daily price moves. The Aug. 14 cutoff means subsequent changes in the value of investors’ holdings are outside the loss tally.