Svmuu News CICC: According to the research report, overall, the current on-exchange leverage ratio for the Korean stock market is around 2x to 5x. While absolute leverage has reached a historical high, the ratio relative to market capitalization is not extreme by either horizontal or vertical standards. Market sentiment and liquidity indicators show some signs of tension but are not significantly strained.
Looking ahead, high leverage will inherently amplify volatility and may even lead to liquidity pressures; for instance, a decline of 16–36% would trigger margin calls. While the pressure for forced liquidations has recently increased, the medium- to long-term trend will depend more on fundamentals. (Jin Shi)