South Korea’s commodity exchange-traded products reached 12.4 trillion won ($9.14 billion) as of Sept. 11, up 1.9% from the end of last year, as geopolitical tensions and volatile oil and natural gas prices attracted short-term speculative funds. Oil ETPs rose 46.7% to 2.68 trillion won, lifting their share of the commodity ETP market from 15% to 21.6%. The Financial Supervisory Service warned that leveraged and inverse products accounted for 37.4% of commodity ETP value, compared with 7.4% across the wider ETP market, and represented 88.4% of oil products and 93.6% of natural gas products. WTI futures surged 97% from $57.3 a barrel in January to $113 in April before falling 39% to $68.6 in July, while gold futures rose 23% in late January before dropping 18% by the end of March. The FSS said repeated price swings can create negative compounding, causing leveraged products to underperform and inverse products to incur losses even when investors anticipate broader market moves correctly. It also highlighted premium and discount risks, with 68.2% of crude oil ETPs recording a maximum premium/discount ratio above 5% over the latest three months. ETNs issued since 2021 can be automatically delisted below 1,000 won, while older products may also face delisting when pricing discrepancies can no longer be properly managed. The regulator will monitor trading volumes and premium/discount ratios and consider further consumer alerts if risks intensify.