MY PEOPLE ARE RISKING EVERYTHING

@rainy.yaps

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Why it worked

The video uses a high-stakes, contrarian narrative about 'degenerate' financial behavior to hook viewers, combined with clear, data-backed explanations of complex financial mechanisms like leveraged ETFs.

Summary

The creator discusses the risky financial behavior of retail investors in South Korea who are liquidating life insurance policies to invest in leveraged ETFs. He explains how these funds compound losses and highlights that even the national pension fund has engaged in similar speculative behavior.

Structure

1Introduction to the trend of Koreans cancelling insurance for stocks
2Explanation of the KOSPI rally and retail investor behavior
3Details on the use of leveraged ETFs and policy loans
4The role of the national pension fund in the market
5How leveraged ETFs compound losses during market volatility
6Conclusion on the speculative nature of these investments

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MY PEOPLE ARE RISKING EVERYTHING South Korea's nominal GDP is approximately $1.93 trillion. Policy surrender payouts at the country's three largest life insurers, Samsung Life Insurance, Hanwha Life Insurance and Kyobo Life Insurance, reached 4.9 trillion won ($3.3 billion) in the first quarter, up 16.3 percent from a year earlier, according to industry data on Monday. South Korean margin loan balances surpassed a record $32 trillion won (approximately $21.7 billion USD) in early 2026, driven by aggressive retail investor stock speculation during market rallies on the KOSPI index. South Korea's National Pension Service (NPS) enforces a portfolio rebalancing rule requiring the fund to sell domestic equities when their total value exceeds target asset allocation caps. Though it uses strict caps and gradual execution limits to prevent market crashes. When a booming stock market pushes local stock weight past permitted limits (such as a target of 20.8% and tactical ceilings), the fund must trim holdings back into alignment. South Korea launched 14 single-stock leveraged ETFs tied to Samsung Electronics and SK Hynix in late May 2026, triggering extreme KOSPI volatility, and quick regulatory regret from Financial Supervisory Service. How the leverage works Samsung posted a second-quarter operating profit of 89.4 trillion won ($58.4 billion) in preliminary earnings Tuesday, roughly 19 times what the company earned in the same three months of last year. But Samsung stock gave up as much as 10% during trading session in Seoul before settling 6.9% lower at the close. SAMSUNG ELECTRONICS 74,600 KRW -6.92% SK Hynix shares dropped over 7% amid a broader semiconductor sell-off driven by Wall Street tech pullbacks, high valuation re-assessments, and cooling enthusiasm over near-term artificial intelligence spending growth. This downturn occurred alongside its massive Nasdaq ADR listing under the ticker SKHY. Single-stock leveraged exchange-traded funds tracking SK Hynix have faced steep double-digit plunges exceeding 26% to 43% over a monthly span. This steep drop stems from a combination of underlying memory chip volatility, daily compounding decay, and massive mechanical rebalancing sell orders. FOLLOW FOR MORE

Original caption

People in Korea are cancelling their life insurance policies just to buy into this rally 🇰🇷📈 Samsung and SK Hynix are now worth more than Korea’s entire GDP, and retail investors are piling into leveraged ETFs to squeeze even more out of the run. Even the fund managing the country’s actual pensions broke its own rules to chase it too. Follow for more stories like this 👀 #KOSPI #SKHynix #leverage #stockmarket #Tech

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Transcript

Why are my people so degenerate? People in Korea are cancelling their life insurance policies at a loss just to buy stocks before the rally's over. Follow along because this one gets a lot worse the more I talk. So this year Samsung and SK Hynix together became worth more than Korea's entire GDP. The KOSPI, basically Korea's version of the S&P, is up over 85% this year. New record highs. It's the best performing major index in the world and people don't want to miss it. Insurance surrenders, so people who want to give up their insurance to cash out at the top three largest life insurance firms in Korea hit 4.9 trillion won, that's around $3.3 billion, in the first quarter alone. People are literally cancelling their policies at a loss just to cash into the market. On top of that, policy loans, basically borrowing against your own insurance, 32 trillion won, over $20 billion. Here's where it gets worse. It's going into just two stocks through products that are designed to multiply that bet. And it's not just individuals doing this. This is the level of degeneracy happening in Korea. Korea's national pension fund, the biggest one in the whole world, has one rule. When a single stock becomes too large within the overall portfolio, they're supposed to automatically sell some off to rebalance. Except back in January, they suspended that rule so they can keep riding this rally instead. Good old Barclays did the math, and if the fund kept its own rule, it would have sold off roughly 130 trillion won, that's around $84 billion, back in May. But instead, none of that hit the market. 14 new leveraged ETFs launched at the end of May. And here's how they work. If Samsung or SK Hynix goes up 1% in a day, you make 2%. If it drops 1%, you lose 2%. One of these funds became the single most traded ETF in the entire country, traded more than the fund that tracks the entire KOSPI 200. Then in June, a strong US jobs report made a Fed interest rate hike likely. Then the KOSPI drops another 8.3% in a single day. Trading actually got paused for several minutes. That's called a circuit breaker. It's designed to stop a full panic, but it's also a sign of how violent that swing was. Three weeks later, the won hit a 17-year low. And even after watching all of this happen, investors put in another 1.6 trillion won, it's around $1 billion, into those same funds in the first four days of July. Then Samsung actually delivers. On the 7th of July, record preliminary earnings, and Samsung stock dropped 7% that day. It's a classic sell the news move. Those earnings gave investors a good excuse to start taking profit. The next day, the drop spreads across the whole chip sector. And here's the part that catches people out. So if we zoom out over the entire stretch, from early June to early July, SK Hynix stock fell over 7%, and that leveraged ETF tracking it fell over 31% over the same stretch. Now I know what you're thinking, it should be 14%, right? But you'd be wrong. Here's why. These funds don't double your gains or losses over time. They double it every single day, then compound that. So when a stock swings up, then down, then up again, instead of just trending to one direction, those daily doublings stack up on each other and eat away at your money way faster than if the stock was just falling. Now if you stretch that over a whole month of swings like that, then those gaps are going to compound. That's what wiped out the extra 17%. So cancelling your insurance to make a 2x leverage bet on two single companies is not investing, it's gambling with extra steps. And the scary and degenerate part isn't that people keep doing this and losing money, it's that funds managing people's pensions did the same exact shit. Follow for more.