Goldman Sachs Sees $110B HK IPO Boom, Flags 40% ETF Volatility
GS•Goldman Sachs sales desk warned that the KIM ACE SK Hynix Single Stock Leverage ETF’s daily rebalancing acted as a volatility “accelerator” after the fund swung 40% wrong-way on low liquidity. Goldman Sachs forecasts Hong Kong will host $110 billion in IPOs, follow-ons this year as Chinese brokers inject $5.6 billion abroad.
1. Volatility Warning for Korean Leveraged ETF
Goldman Sachs’ sales desk highlighted the KIM ACE SK Hynix Single Stock Leverage ETF’s daily rebalancing mechanism as a volatility “accelerator,” noting the product plunged 40% against SK Hynix’s 8.7% gain due to widening bid-ask spreads and thin liquidity at the close in Korea.
2. $110 Billion Hong Kong IPO Projection
Goldman Sachs projects Hong Kong exchanges will host a record $110 billion in IPOs and follow-on share sales this year, citing planned $5.6 billion capital injections by Chinese brokerages into offshore units as Beijing encourages global expansion amid domestic market pressures.
