Mar 16 β€’ 06:59 UTC πŸ‡°πŸ‡· Korea Hankyoreh (KR)

Increasing 'Active' ETFs in the KOSDAQ Market

The KOSDAQ market is seeing a rise in 'active' ETFs, which aim for excess returns compared to market indexes, following a government initiative to stimulate the market.

The KOSDAQ market in South Korea, traditionally dominated by passive ETFs that simply track index performance, is witnessing a significant shift with the introduction of active ETFs. These funds, managed by professionals who selectively choose stocks and adjust their weights, are designed to outperform standard market indices. This development follows the government’s announcement last December of measures to invigorate the KOSDAQ market, leading to substantial capital inflows. Major fund managers, including Samsung Asset Management and Timefolio Asset Management, have recently launched their active ETFs, reflecting a growing interest among investors. The KoAct KOSDAQ Active ETF launched by Samsung Asset Management attracted remarkable inflows of 799.8 billion won by the 13th, making it the top fund in terms of net inflow among all listed ETFs, while Timefolio's ETF garnered 413.8 billion won. Collectively, these two funds attracted over 1.2 trillion won, showcasing significant market enthusiasm. Initial performances indicate varied results based on management strategies; the KoAct fund saw a 14.7% increase by the 13th, while it declined by 3.12% amidst falling sector indices on the 16th. In response to the evolving investment landscape, Hanwha Asset Management is set to launch another active ETF, PLUS KOSDAQ 150 Active, which will maintain a balance between established KOSDAQ 150 companies and those anticipated to join the index. Analysts note that the government's decision to include KOSDAQ 150 in performance benchmarks for domestic funds underscores the growing emphasis on active performance in KOSDAQ ETF offerings, aligning with broader market dynamics that favor active investment strategies.

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