Zhongjin: South Korean stocks' absolute leverage has reached a historical high

The CICC research report believes that, overall, the leverage ratio of Korean stocks in the current onshore market is around 2x to 5x, with absolute leverage reaching historical highs. However, both horizontal and vertical comparisons of the market value ratio are not extreme. Market sentiment and liquidity indicators are slightly tense but not significant. Looking ahead, high leverage itself will amplify fluctuations and may even bring liquidity pressure. A decrease of 16% to 36% would trigger margin calls, and recent liquidation pressures have risen. However, the medium to long-term trend will depend more on the fundamentals.