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The exchange-traded fund market is pressing against the limits of the leverage it can absorb.
Single-stock ETFs have pulled the product class far from the low-cost, tax-efficient core index funds that built the original ETF boom. SK Hynix is the latest name to mark how far the structure has traveled.
From index funds to single-stock risk The ETF format built its reputation on a specific model: broad index exposure, available at low cost, with tax efficiency as a structural feature. That original product is intact.
The category that has grown alongside it is a different thing. Single-stock ETFs concentrate all of a position's risk in one name, then add leverage on top of that concentration.
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