Story perspectives

KOSPI Plummets 22% in July, Regulators Tighten ETF Rules

7/31/2026

Summary

KOSPI Slides

KOSPI fell 22% in July 2024, its steepest monthly drop since 2008.
Samsung Electronics rose 27% and SK Hynix 30% falling 13.4% and 14.6% on July 28.
SK Hynix posted Q2 revenue of 79 trillion won, missing an 84 trillion-won forecast, and its shares fell 19%.
Leveraged ETFs forced rebalancing, raising volatility to 2008 highs.
Analysts Jeff Kim (KB Securities) and Goldman Sachs blamed short-term trading and warned of AI memory shortages.

Summary

Korea Regulators Hike

Regulators in Korea raised deposit for leveraged ETFs from 10 million won to 30 million won on July 31, 2026, and barred substitute securities from counting toward the margin.
By 11 a.m. on July 31, 2026, foreign investors net-bought 4.86 trillion won ($3.38 billion) in the Kospi market, while individuals sold 4.46 trillion won and firms sold 976.7 billion won.
The Kospi 200 volatility index fell 2 percent to 84.46, while investment trusts and public pension funds added 200 billion won in net purchases.

History

Historical Context

In March 2008 the KOSPI fell 50%, the drop since the 1997 Asian-financial crisis that plunged the Seoul exchange and drew IMF aid. The fallout spurred reforms, leading the Financial Services Commission to cap leveraged-ETF deposits at 10 million won and later raise the ceiling to 30 million won as the index slid another 22% in July 2026. The pattern shows how crises shape Korea’s market safeguards.

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KOSPI Slides

KOSPI fell 22% in July 2024, its steepest monthly drop since 2008.
Samsung Electronics rose 27% and SK Hynix 30% falling 13.4% and 14.6% on July 28.
SK Hynix posted Q2 revenue of 79 trillion won, missing an 84 trillion-won forecast, and its shares fell 19%.
Leveraged ETFs forced rebalancing, raising volatility to 2008 highs.
Analysts Jeff Kim (KB Securities) and Goldman Sachs blamed short-term trading and warned of AI memory shortages.

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