After the last few days of extreme volatility on Korean market, and unrelated research of UCITS ETF-s I've done - I'm left confused.
Since the UCITS ETF-s are capped 30/18 meaning 30% maximum concentration in the top performing stock and 18% maximum concentration in all other stocks inside the fund. Currently the market share of Samsung is about 26% and SK Hynix 21% of the Korean index.
Does that mean then when let's say as example FLXK Franklin UCITS ETF rebalance mid-september they will be forced to sell 3% of SK Hynix no matter what? And that's just one fund of one provider. When you apply that to all ETFs tracking Korea that's a huge selling pressure, just because regulations.