Shifts and Strategies in Korea's ETF Market
The domestic active equity ETF market in Korea is rapidly expanding, with competition intensifying among management companies over strategies and performance. Notably, some asset managers investing in AI and power infrastructure-related stocks are achieving excess returns. There are also calls for relaxing correlation regulations to allow for more strategy diversification.
Asset managers are increasingly focusing on expanding their allocations in bio, automotive, financial, and AI-related stocks within their active ETF strategies. For instance, Timefolio has increased its share of bio and AI stocks, while Midas Asset has significantly incorporated Samsung Electronics’ preferred shares. These strategic shifts are expected to enhance the performance of active ETFs, drawing interest from investors.
The increasing volatility in the domestic stock market is highlighting the profitability of inverse and leveraged ETFs. ETFs combining AI industry exposure with high-yield stocks are gaining popularity, and demand for gold investment remains strong. In response, a new ETF that combines the S&P500 with gold is being launched to meet diverse investor needs.
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