Turtle Capital: "Korea Is a Key Market... Single-Stock Leveraged ETFs Not the Cause of Stock Market Crash"

Matthew Turtle, CEO of US Asset Manager TCM, Visits Korea

25% of T-REX Series AUM Comes from Korean Investors

Listing of SK hynix ADR Spurs Interest from US Investors

Key Investment Theme: AI Bottlenecks

Matthew Turtle, CEO of Turtle Capital Management (TCM), a leading active exchange-traded fund (ETF) manager in the United States, visited Korea and emphasized the importance of Korean investors. In particular, he shared his views on single-stock leveraged ETFs, which have recently been cited as a cause of increased volatility in the Korean stock market. He also drew attention by highly praising the market response to the ETF recently listed on the New York Stock Exchange that uses SK hynix American Depositary Receipts (ADR) as its underlying asset.

On the 8th, at a press conference held in Yeouido, Seoul, Matthew Tuttle, CEO of Tuttle Capital Management (TCM), is presenting on investment strategies and related topics.

On September 8th, CEO Turtle held a press conference in Yeouido, Seoul, where he explained, "Approximately 25% of the total assets under management for the T-REX single-stock leveraged ETF series, which TCM launched in cooperation with Rex Shares, comes from Korean investors' funds." He further stated, "Korea is an extremely important core market for our company, and I came to Korea to experience firsthand the demand and sentiment of local investors," explaining the reason for his visit.

Regarding the criticism that single-stock leveraged ETFs were identified as the main drivers of increased volatility during the market crash in Korea last month, CEO Turtle made it clear that he does not share this view. He said, "I do not agree with the claim that single-stock leveraged ETFs are causing greater market volatility," and added, "The underlying stocks that attract significant investor attention are inherently highly volatile. Even without leveraged ETFs, investors would have turned to options, futures, or other derivatives to gain exposure to those stocks." He continued, "Unlike regular ETFs, leveraged ETFs have a structural feature where they reset daily. Rather than chasing short-term surges, it is most important to provide investor education so that the structure and risks of these products are clearly understood."

Regarding the 'T-REX 2x Long SK hynix ETF (HYNX)' based on SK hynix ADRs, which was recently listed on the New York Stock Exchange, he reported that the local response has been extremely strong. CEO Turtle assessed, "The listing of SK hynix ADRs was a game changer that made it much easier for American investors to access and develop interest in the stock." However, on plans to launch leveraged ETFs using other major Korean companies such as Samsung Electronics, he answered, "We are considering it, but under the U.S. Securities and Exchange Commission (SEC) regulations, an ADR listing must come first in order for an ETF to be launched."

CEO Turtle expressed a negative outlook on bond investments. Taking into account global debt levels and perceived inflation, he diagnosed that bonds do not function as an effective hedge at current interest rate levels and hold little investment value. He remarked, "At present, bonds are not a suitable investment target," and added, "Interest rates are likely to continue rising due to inflation and other factors. Therefore, for bonds to become suitable for investment, interest rates would have to rise significantly higher than they are now."

He identified artificial intelligence (AI) bottlenecks as the most noteworthy investment theme currently. He suggested not only memory semiconductors, but also photonics—an optical and laser-based data transmission technology—as well as power and space data centers, as next-generation bottleneck investment opportunities.

TCM is an independent US asset manager, managing approximately 5 billion dollars in assets as of July and holding about 70 ETFs. Previously, the firm had launched ETFs such as the Short Innovation ETF, which inversely tracks the performance of Cathie Wood's well-known ARK Innovation ETF, as well as the Inverse Cramer ETF, which invests contrary to the recommendations of Jim Cramer.

This content was produced with the assistance of AI translation services.