PANews reported on January 16 that major South Korean stock exchanges are in discussions with financial regulators to consider easing restrictions on high-risk leveraged exchange-traded products (ETPs). Despite a historic surge in the domestic stock market, retail investor funds have failed to flow back to the country. According to the CEO of the Korea Exchange, the exchange is studying a gradual relaxation of restrictions, which currently prohibit high-risk products such as leveraged single-stock ETFs and funds offering three times or more leverage on indices. This move highlights South Korea's predicament: despite the benchmark Kospi index surging 92% over the past year, investors continue to favor the US market. Regulators point out that a significant reason for the weakening of the local currency is the large outflow of domestic retail funds into the US stock market.


