Data released by a South Korean lawmaker's office shows that within just a few months, retail investors suffered losses of approximately 2.3 trillion won ($1.7 billion) on leveraged ETF products tracking South Korea's two major chip giants.

The office of Choi Eun-seok, a lawmaker from the main opposition People Power Party, said these losses were incurred between May 27 and August 14 by customers of 10 South Korean securities firms who invested in single-stock ETFs and notes linked to Samsung Electronics and SK Hynix.

These single-stock tracking products have intensified volatility in the South Korean stock market since their launch in May.

As a bellwether for artificial intelligence (AI) investment, leveraged bets once helped propel the South Korean stock market into the ranks of the world's best-performing markets, but the trend subsequently reversed.

The sharp swings triggered by these high-risk products prompted South Korean regulators to step in to cool down the retail investment frenzy, and trading volumes in the related products dropped significantly as a result.

Choi's office said the data came from the Financial Supervisory Service, which compiled figures from multiple securities firms including Mirae Asset Securities, Kiwoom Securities, Samsung Securities and NH Investment & Securities.