In the first week of November 2026, South Korean investors bought a net nearly 3 trillion won in U.S. stocks. About 74% of the total went into SOXL, a triple-leveraged U.S. semiconductor ETF.
According to SEIBro, the Korea Securities Depository’s securities information portal, net purchases of U.S. stocks from November 2 to 6 totaled $2.19753 billion (about 2.982 trillion won). SOXL alone accounted for $1.62525 billion (about 2.2 trillion won).
That exceeded the $1.96234 billion bought on a net basis throughout August 2026 and was more than double September’s monthly net purchases of $1.00128 billion.
A comparison of weekly net purchases from January 2022 through November 6, 2026, puts the figure fourth highest on record. South Korean investors continued to buy heavily even as volatility in the U.S. stock market increased.
Triple-leveraged semiconductor ETF draws 74% of net U.S. stock purchases
Investor sentiment toward technology stocks deteriorated rapidly as the possibility of tighter AI data center regulations came into focus after the November 3 U.S. midterm elections.
Concerns spread that policy changes affecting new data center construction and permits, as well as electricity-rate protections, could slow investment in AI infrastructure. On November 5 (local time), the Nasdaq Composite fell about 5.52% from the previous trading day.
Despite the growing uncertainty, South Korean investors bought semiconductor- and technology-related products heavily.
SOXL topped the net-buying rankings from November 2 to 6 at $1.62525 billion. Alphabet Class A shares (GOOGL) ranked second at $497.05 million, followed by TQQQ, which seeks three times the Nasdaq-100 Index’s daily return, at $220.22 million.
QLD, which seeks twice the Nasdaq-100 Index’s daily return, ranked fourth at $160.92 million. Three of the four most heavily bought securities were leveraged ETFs.
SOXL’s commanding lead over the other securities in net purchases suggests that South Korean investors expected a rebound in the semiconductor sector and were willing to take on substantial risk.
Why leveraged ETFs are vulnerable in markets that repeatedly rise and fall
SOXL’s full name is Direxion Daily Semiconductor Bull 3X ETF. It is designed to deliver three times the daily return of the NYSE Semiconductor Index, which reflects the share prices of major semiconductor companies listed in the United States.
If the underlying index rises 5% in a day, the fund aims for a return of about 15%. Conversely, a 5% decline could result in a loss of about 15%.
The key point is that the leverage multiple applies to each trading day’s return, not to the cumulative return over the entire investment period.
Because leveraged ETFs readjust their target exposure each day based on their changing asset value, their final returns can differ depending on the path prices take, even if the underlying index closes at the same level.
For example, if the underlying index falls 20% from 100 to 80 and then rebounds 25% the next trading day, it returns to 100, leaving a cumulative return of 0%.
But a product assumed to track twice the daily return exactly would fall from 100 to 60 and then recover to 90, leaving a 10% loss. A three-times leveraged product would fall from 100 to 40 and then recover to 70, ending with a 30% loss.
This phenomenon is commonly called “negative compounding” or “volatility drag.” It is a major reason why repeated rises and falls can erode the long-term returns of leveraged ETFs.
Conversely, in a market with a sustained upward trend, compounding can work in investors’ favor, potentially producing a return greater than the underlying index’s cumulative return multiplied by the leverage multiple.
To understand the risks of leveraged ETFs, investors therefore need to consider not just how much the index ultimately rises, but also its volatility and price movements over the investment period.
SOXL +1.86%, SOXX +32.75%: Different outcomes from the same semiconductor index
The price movements of SOXL and SOXX in 2026 offer a concrete example of how leveraged products behave.
BlackRock’s iShares Semiconductor ETF, SOXX, generally tracks the performance of the NYSE Semiconductor Index. It shares the same underlying index as SOXL but does not use a structure that triples daily returns.
At the opening bell on January 2, the first trading day of the year, SOXL began trading at $45.13 and SOXX at $102.85. Both reached their highs for the year on June 22 as the semiconductor sector rose.
SOXL climbed as high as $302 intraday, up about 569.18% from its opening price at the start of the year. SOXX also rose to $218.65, a gain of about 112.59%.
Investors who had bought both products at the start of the year and sold each at its respective high would have earned a far higher return on SOXL. But as the semiconductor sector underwent a correction, the gap between their cumulative returns changed markedly.
At the November 6 close, SOXL stood at $45.97, just 1.86% above its opening price at the start of the year, while SOXX was at $136.53, retaining a gain of 32.75%.
The figures show that even when two products track the same semiconductor index, the one that posts higher returns during the year is not necessarily the one that delivers the better return to investors who hold on to it.
The Koreanization of the U.S. Stock Market: Investment Behavior, Not Nationality, Is the Issue
South Korean investors’ concentrated buying of U.S. stocks has also been discussed overseas as an investment phenomenon.
In a March 2025 article titled “The Squid Game Stock Market,” Owen Lamont of U.S. asset manager Acadian argued that the U.S. stock market was becoming Koreanized.
He noted that South Korean retail investors account for a significant share of trading in some U.S. thematic stocks and high-risk ETFs, and argued that money seeking high returns over short periods could contribute to excessive price swings in certain stocks.
He also pointed to instances of concentrated buying by South Korean investors during past market crashes, raising questions about retail investors’ decision-making and herd behavior.
The point is not that these investors are South Korean, but that retail investors seeking high returns may underestimate risk or pile into particular products.
The latest figures on net purchases of U.S. stocks raise a similar question.
Aggressively buying stocks in a falling market can deliver strong returns if the market later rebounds. But applying the same strategy to leveraged ETFs can produce very different results depending on the holding period and volatility.
In particular, the price movements of SOXL and SOXX this year show that choosing an asset that moves in the right direction is not enough: the timing of purchases and sales, and the compounding effect between them, are also critical to investment performance.
So what matters about the roughly 3 trillion won in net purchases of U.S. stocks is not just the amount invested. It is also that about 74% went into products with three-times daily leverage, and how such products generate returns in volatile markets.
