An exchange-traded fund (ETF) that tracks twice the stock price fluctuation rate of Samsung Electronics as its underlying asset will be listed on the Hong Kong Stock Exchange (HKSE). The stock price fluctuation rate of Samsung Electronics is relatively lower compared to Tesla or NVIDIA, which are preferred by domestic investors, but investing in this ETF can provide a leverage effect. It is also a product that allows one to short Samsung Electronics without engaging in short selling or futures.
CSOP, a Hong Kong ETF management company, noted on the 14th that it will list the 'CSOP Samsung Electronics Daily 2X Leverage' and 'CSOP Samsung Electronics Daily -2X Inverse' ETFs on the Hong Kong stock market on the 19th. The leverage ETF is structured such that if Samsung Electronics' stock price rises by 1%, investors gain 2% revenue, while the inverse leverage ETF provides 2% revenue if Samsung Electronics' stock price falls by 1%.
While there are no ETFs tracking a single stock in South Korea, it is possible to list a single stock ETF that tracks only Samsung Electronics in Hong Kong. However, domestic investors must open an overseas stock account to invest in it.
The ETF will be launched in two versions: U.S. dollars and Hong Kong dollars. Both the fluctuations in Samsung Electronics' stock price and changes in dollar value will affect returns. The total fees are relatively high at 2.0%.
CSOP explained, 'As the top big tech company in Asia, Samsung Electronics has a diverse business portfolio and high financial stability,' adding that 'this ETF offers investment opportunities in Samsung Electronics' short-term volatility.' The leverage and inverse ETFs are recommended products for investors engaging in short-term trading because the accumulated volatility can lower revenue.