South Korean lawmakers are increasingly alarmed about leveraged exchange-traded funds (ETFs), pressing for policy and oversight changes after public concern mounted over how the products can rapidly amplify losses for investors.

The lawmakers said the current framework has left retail investors vulnerable, particularly when leveraged ETFs move aggressively during market volatility. They argued that issuers should face stricter requirements on disclosures, risk warnings, and suitability protections.

Calls for reform are gaining momentum in parallel with growing scrutiny of how leveraged and inverse ETF structures are sold and monitored, with lawmakers saying it is necessary to close gaps that allow products to be marketed to people who may not fully understand how daily leverage works.

Pressure is also aimed at regulators to strengthen enforcement and require faster corrective actions when problems emerge.