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| (Provided by the Financial Investment Association) © News 1 |
Starting on the 4th, if you want to invest in leveraged (±2x) listed index funds (ETF) and listed index securities (ETN) such as’Gob Bus’, you must entrust the basic deposit and complete the pre-training course. In particular, if you have not received education until the 31st of last month, you cannot invest in leveraged ETFs and Etns from the new year.
According to the financial investment industry on the 3rd, the Korea Exchange has been implementing the basic deposit system since September 7th last year for new investors of leveraged ETFs and ETHs. Starting on the 4th, the basic deposit system will be implemented for existing investors. This is to curb speculative demand from investors who follow-and-sell without sufficient prior knowledge.
Accordingly, individual investors (excluding professional investors) can submit leveraged ETF/ETN purchase orders only when they deposit cash or substitute securities as basic deposits in accordance with the basic deposit application standards set by the securities company they trade with.
The basic deposit is applied in a different amount (10 million to 30 million won) in consideration of the investor’s investment purpose and investment experience. To find out the specific amount, you can inquire with the securities company you are trading with.
In addition, in order to invest in leveraged ETFs and Etns, you must complete the online training course (1 hour) prepared by the Financial Investment Education Institute and register your training completion number with a securities company.
Previously, it was possible to trade without any restrictions by agreeing to the securities company’s’Leverage ETF/ETN transaction risk notice confirmation’.
Accordingly, existing investors must complete the online training course by the 31st of last month, and if they do not, they cannot purchase leveraged ETF/ETN products from the 4th. As existing investors do not receive timely training, there may be confusion that they cannot buy leveraged ETF/ETN products from the 4th.
Professional investors, foreigners, and investors who do not conduct direct transactions, such as transactions based on discretionary investment contracts, can invest in leveraged ETFs and ETFs without prior training.
Meanwhile,’KODEX 200 Futures Inverse 2X’ was the most net-purchased ETF product from January 2nd to December 30th of last year by individual investors. According to the Korea Exchange, during this period, individuals net bought 3,588.2 billion won, while institutions and foreigners net sold 3,669.4 billion won and 8.8 billion won, respectively.
This ETF, called the Gop Bus, is a commodity that tracks twice the KOSPI 200 index in reverse, and profits only when the index falls. Conversely, if the index rises, you lose. According to NH Investment & Securities, individual investors who bet on’Kub Bus’ recorded a loss of -76.8% in the process of rebounding in V (V) after the domestic stock market crashed last year.