On July 22, Direxion Daily MSCI South Korea Bull 3x Shares declined 8.1% overnight, trading at $19.96/share with turnover of $124 million. The pullback followed a sharp 14.07% intraday rally on July 21 fueled by investment bank bottom-fishing signals and Korean presidential calls for swift regulatory reform.

However, multiple research reports released on July 21 warned that Korean market deleveraging remains far from complete. Xingzheng Strategy noted leveraged ETF scale decline is almost entirely driven by NAV erosion rather than actual share redemption, with the top-10 Korean leveraged ETFs recording nearly $6 billion in net inflows during the correction. Margin lending has declined only 13.6% from peak versus 30-70% in prior deleveraging cycles, suggesting the unwinding process is less than halfway through. JPMorgan estimated leveraged ETF unwinding at approximately 75% complete but hedge fund deleveraging at only over 50%, indicating residual selling pressure may persist and raising questions about the sustainability of the preceding rebound.

(The above content is based on publicly available market information, generated by a program or algorithm, and is intended solely as a stock movement alert. It does not constitute investment advice or a basis for trading decisions.)