The iShares MSCI South Korea Capped ETF, the largest exchange-traded fund tracking the country’s stocks, had the biggest weekly withdrawal since inception in 2000 amid investor concern over a revival of tensions on the Korean peninsula and an escalating selloff in emerging markets.

Traders pulled $195.4 million from the ETF, whose top holdings include Samsung Electronics Co. and Hyundai Motor Co., in the five trading days ended Aug. 21, according to data compiled by Bloomberg. The fund, which has $3.1 billion in assets, fell 7.2 percent in New York to an almost four-year low of $45.67 during the week and is down 27 percent from a high in April.

Investors are losing confidence that South Korea can defuse tensions with its neighbor and withstand a slowdown in China, its biggest trading partner, according to Ankur Patel, chief investment officer at R-Squared Macro Management. North Korean leader Kim Jong-Un has threatened to launch an attack after exchanging fire across the border earlier this month in what is becoming one of the most serious confrontations between the two countries in recent years.

Global Rout

While the South Korean government pledged to stabilize financial markets amid provocations from the North and the fallout from China’s growth, there is only so much the Bank of Korea can do to prevent investors from exiting. More than $3.3 trillion has been erased from the value of global equities after China’s decision to devalue its currency spurred a wave of selling across emerging markets. 

“South Korea itself can’t dictate its fortunes from here on,” Patel said by phone from Birmingham, Alabama, on Friday.

The central bank has cut interest rates four times in the past year to a record low of 1.5 percent and the government introduced its largest-ever budget this year.

Bearish bets against the Korea ETF have tripled in the past month to 2.2 percent of shares outstanding on Aug. 20, according to data compiled by Markit, a London-based research firm.

North Korea and South Korea continued high-level talks on Saturday aimed at defusing tensions across their heavily fortified border. Kim’s top military aide Hwang Pyong So and South Korean President Park Geun Hye’s chief security adviser Kim Kwan Jin are meeting at the border village of Panmunjom, the Unification Ministry in Seoul said in a text message.