Trading & Options · Profile from Trading and Options Research Companion
Korea Exchange
South Korea's single exchange group, formed in January 2005 by merging the Korea Stock Exchange, the KOSDAQ market and the Korea Futures Exchange. It runs the market for KOSPI 200 options, listed on 7 Jul 1997, which became the world's most traded derivatives contract: 3.67bn contracts in 2011, when no other contract in the world topped one billion (FIA annual survey, Mar 2012). The boom was built on retail traders buying cheap index options. It was also the stage for the 11 Nov 2010 "option shock", when Deutsche Bank-linked traders sold KRW 2.44tn (~US$2.2bn) of stocks in the last ten minutes of an expiry day and, according to Korea's regulators, made KRW 44.87bn (~US$40.5m) on put positions (FSC, 23 Feb 2011). Korea then did what India did a decade later. It raised the option contract multiplier fivefold, from KRW 100,000 to KRW 500,000 per index point, in steps from March to June 2012, and added deposit and education rules for retail. Volume fell to 1.58bn contracts in 2012 and 580m in 2013 (FIA). For a trading book KRX is the clearest case of a regulator shrinking a retail options market by redesigning the contract. The US comparison is Cboe's SPX and the 0DTE boom, where the US has so far gone the other way.
At a glance
- Founded
- Korea Exchange (KRX) created in January 2005 under the Korea Stock & Futures Exchange Act by merging the Korea Stock Exchange (KSE), KOSDAQ and the Korea Futures Exchange (KOFEX) (KRX brochure; Korea Times, 1 Nov 2020). The stock exchange's roots go back to 1956 (secondary; some sources give 1953 — verify)
- Headquarters
- Busan (registered head office and derivatives market), with the cash-market and market-oversight offices in Yeouido, Seoul (secondary sources differ on which is "the" headquarters — verify)
- Type / ownership
- Exchange group and clearing house (KRX clears its own listed derivatives); owned by securities firms and other shareholders, not listed (from memory, verify); designated a public institution Jan 2009, designation ended 29 Jan 2015 (Korea Times; KRX via Mondo Visione — V4)
- Regulators
- Financial Services Commission (FSC) and its Securities and Futures Commission; Financial Supervisory Service (FSS); KRX's own Market Oversight Commission disciplines members
- Flagship derivatives
- KOSPI 200 futures (May 1996) and options (7 Jul 1997); mini KOSPI 200 futures (20 Jul 2015) and options (2015); KOSPI 200 weekly options (Thursday expiry from 23 Sep 2019; Monday expiry from 31 Jul 2023); KOSDAQ 150 futures and options; stock futures and options; KTB (government bond) and USD futures; V-KOSPI 200 futures (KRX product page; FSC releases)
- Contract terms (2026)
- KOSPI 200 options: KRW 250,000 per index point (since Mar 2017); European exercise, cash-settled; regular session 08:45–15:45, night session 18:00–06:00; position limit 10,000 delta for individuals, 20,000 for others (KRX product page, Nov 2026)
- Scale (dated)
- KOSPI 200 options: 3,671.66m contracts in 2011 (world's most traded); >1.58bn in 2012 (still the world's most traded); 580.46m in 2013 (FIA annual surveys, Mar 2012 and Mar 2014)
- Signature moves (incl. failures and enforcement)
- KOSPI 200 options launch (1997); the 2005 integration; the Eurex link and night trading (2010–25); the Deutsche Bank expiry shock (2010, enforcement; criminal case ended in acquittal 2023); the multiplier increase and retail curbs (2012); the multiplier cut and mini contracts (2015–17); weekly options (2019–23); the single-stock leveraged ETF boom and curbs (2026)
8 strategic moves analysed
Each one gets a full strategy file in the companion: context, the decision, the financing, what happened, and the lesson.
1997
KOSPI 200 Options Launch
New product and market (exchange listing)
2005
KRX Integration and the Busan Headquarters
Merger and restructuring
2010
Deutsche Bank Option Expiry Shock
Manipulation case: regulatory, exchange and criminal enforcement (failure of market design; enforcement outcome mixed)
2010
Eurex Link to KRX Night Session
Market-structure change and partnership (extended trading hours)
2012
Option Multiplier Increase and Retail Curbs
Exchange product and rule change (contract size) plus retail-access rules
2017
Multiplier Cut and Mini Contracts
New product (mini contracts) and rule change (contract size cut) — a partial reversal of 2012
2019
Weekly Options Thursday and Monday
Exchange product expansion (short-dated expiries) — Korea's step toward the US 0DTE model
2026
Single Stock Leveraged ETF Curbs
Exchange product launch followed by regulatory response (retail-access rules, listing suspension)