Business · Markets · 2 hrs ago
Falling Korean share prices delay early payouts on high-return ELS
Equity-linked securities tied to Samsung Electronics, SK Hynix and the KOSPI 200 have missed early repayment tests as South Korean markets fell.
These products promise coupon returns if shares or an index stay above set levels on scheduled assessment dates.
Some products launched in July advertised annualised returns of up to 40%, but required the underlying prices to meet those levels for early repayment.
In one Samsung Electronics and SK Hynix product, SK Hynix closed below the required price, so investors did not receive an early payout.
The missed tests delay investors’ access to their money, though they do not by themselves mean a loss of principal.
Investors could lose principal if prices hit a set knock-in level and fail to recover by maturity, which is usually three years.
More products face their first repayment tests in November and December, and a prolonged or renewed market decline could delay repayment further.
Early repayments on Korean equity-linked securities tied to Samsung Electronics, SK Hynix and the KOSPI 200 have increasingly failed as share and index prices fell.
The failures delay investors’ access to their principal and promised coupon returns.
In one Samsung Electronics–SK Hynix product, SK Hynix closed below the level required for early repayment at its first review.
A separate KOSPI 200-linked product also missed its first early-repayment threshold.
Investors could face losses if underlying prices fall below specified knock-in levels and do not recover by maturity, usually three years.
- Who
- Investors in equity-linked securities (ELS) tied to Samsung Electronics, SK Hynix and the KOSPI 200.
- What
- Falling prices have caused early repayments to fail, delaying the return of investors’ money.
- When
- The first reviews for products issued in July took place in October 2026.
- Where
- South Korea.
- Why
- The underlying share and index prices fell below the thresholds required for early repayment.
This story does not have two clearly opposing sides.
Mirae Asset Securities issued a Samsung Electronics–SK Hynix ELS.
Samsung Securities issued a KOSPI 200-linked ELS.
The Mirae Asset product failed its first early-repayment review because SK Hynix closed below the required level.
The KOSPI 200-linked product failed its first early-repayment review because the index was below its threshold.
- Third-quarter Samsung Electronics ELS issuance
- 20,544 products worth 2.0544 trillion won
- Third-quarter SK Hynix ELS issuance
- 749 products worth 1.945 trillion won
- Third-quarter KOSPI 200 ELS issuance
- 1,881 products worth 5.3067 trillion won
- Mirae Asset early-repayment threshold
- SK Hynix needed to close at or above 1,858,100 won
- KOSPI 200 early-repayment threshold
- 972.32 points; the index closed at 878.16 points
What people are saying
증권사들은 시장 변동성이 클때 ELS 상품을 대거 발행하는 경향이 있다
지금처럼 주가가 떨어진 상황에서는 증권사가 헤지(리스크 회피)를 위해 기초자산인 개별주를 매도하는 만큼 하락이 더 이어질 가능성도 있다