[Edaily Reporter Shin Ha-yeon ] It is becoming increasingly likely that exchange-traded funds (ETFs) will be excluded from trading on the after-hours market (trading after market close), which is scheduled to open this September. This comes as concerns have surfaced regarding market overheating and increased volatility—particularly centered on single-stock leveraged ETFs—along with concerns about price discrepancies and the burden of managing liquidity resulting from after-hours ETF trading.

According to the financial investment industry on the 11th, the Korea Exchange (KRX) has begun reevaluating the introduction of after-hours ETF trading. Although a final decision has not yet been made, there is growing discussion of options such as excluding ETFs from trading or delaying the implementation date.

The exchange held a meeting the previous day with industry representatives, including asset management firms and securities companies, to gather opinions on the introduction of after-hours ETF trading. It was reported that participants expressed concerns about the significant burden associated with extending ETF trading hours.

The growing caution surrounding the ETF after-hours market stems from the recent overheating of single-stock leveraged ETFs. There have been repeated concerns that trading has become concentrated on leveraged products based on certain large-cap stocks—such as SamsungElectronics(005930)and SK hynix(000660) —which has increased volatility in the spot market. In response, financial authorities have introduced a series of stabilization measures, including restricting the listing of new products and strengthening minimum margin requirements.

In particular, concerns have been raised regarding the after-market session (4:00–8:00 p.m.), where constraints may arise in calculating real-time estimated net asset value (iNAV) and in liquidity providers’ (LPs) hedging activities after the regular trading session ends. This is because if the gap between the market price and the ETF’s net asset value widens, investor protection issues could resurface.

Consequently, market attention is focused on whether the plan to allow ETF trading concurrently with the opening of the after-hours market next month will be revised. The exchange had originally planned to operate the after-hours market starting September 14 and to include ETFs applied for by asset management companies and liquidity providers (LPs) in the list of tradable securities.

An exchange official explained, “We are currently discussing the matter, but no official position has been decided yet,” adding, “We plan to provide an update via a press release or other channels as soon as a decision is made.”