The World’s Riskiest Stock Market Just Got Worse [gIgP5L5SK0N]
South Korea's stock market is so crazy right now ----------------------------------------- 0:00 - Intro 0:30 - What Happened in South Korea & Why It's Important 1:38 - South Korea's Economy & Retail Investors' Behavior 6:00 - How Retail Investors Forced a Rule Change 9:10 - Understanding Leverage 11:34 - Understanding Leveraged ETFs 12:49 - Putting It All Together 15:16 - Homelander Violin Rant 16:11 - Samsung More recently, the KOSPI (think of it as the Korean S&P 500) has been freaking smashing. In the past 6 months ALONE it has doubled in value. It has gone from the 8th largest to the Sixth largest stock market in the WORLD in like a matter of days. If it keeps this momentum up, we could see a new headline every day of it breaking new all-time highs. Since the South Koreans are looking for a lottery win, some interesting things started to happen because of all the new gains in their stock market. Over $40B (61T Won) was invested in US leveraged ETFs last year up from $27.5B in 2024. This is a meteoric rise, in fact a 3x leveraged ETF was South Korean’s single most held foreign ETF and probably most held financial security for them in general. And I promise to god I will explain what a leveraged ETF is soon, but what this means is that there’s an immense amount of capital flight to the United States. Which matters for 2 reasons. Okay, so let's start with the first part of this product: Leverage. Leverage is a term for debt, but the reason it gets a special name is because of what it can do. Much like how someone can provide you with physical leverage to get to a higher place or platform, financial leverage does the same thing, but for investment returns, and everyone uses it whether you’re familiar or not.