The KOSPI index in South Korea has experienced volatility exceeding 60% this year, surpassing even Bitcoin's notorious fluctuations. This marks nearly double the volatility of Japan's Nikkei 225. The Korean exchange has triggered circuit breakers seven times this year, compared to none in 2025 and only once in 2024. The primary drivers are Samsung Electronics and SK Hynix, two AI chip giants that together account for over 50% of KOSPI's market value. The AI boom has propelled their stock prices, but valuations remain heavily reliant on investor sentiment, with AI yet to generate sufficient revenue to cover construction costs. The proliferation of leveraged ETFs has further exacerbated market volatility. South Korean retail investors have actively utilized these products, with over $4 billion flowing into leveraged ETFs tracking individual stocks, accounting for more than 70% of the daily trading volume of related stocks. Retail investors have net purchased over 100 trillion won ($67 billion) in KOSPI stocks this year, while foreign investors have net sold approximately $108 billion. Goldman Sachs strategists highlight leveraged ETFs as a major risk factor. Although margin debt has declined from its June peak, it remains significantly higher than the same period last year.