Current Changes and Challenges in the ETF Market
The ETF market is currently experiencing intensified competition among asset management companies, revealing several underlying issues. Firstly, changes in the foreign tax credit system have led to capital outflows from U.S. stock dividend ETFs, highlighting inadequate responses from asset managers. The lack of information exchange between these companies affects investors negatively.
Korean asset management firms are targeting retirement pension markets by launching Target Date Funds (TDF) as ETFs, escalating competition within the pension market. Mirae Asset Management, in particular, aims for high returns by following the S&P500 index, thereby increasing associated risks. Fee reduction is also a fierce battleground, with KB Asset Management offering the lowest fees.
The introduction of Samsung Asset Management's 'buffer-type ETF' is met with skepticism due to exchange rate volatility and complex product structure, raising doubts about its market viability. While it features a 10% loss protection, the product lacks currency hedging, leaving it vulnerable to factors like the declining value of the Korean won. This scenario underscores the need for cautious approaches in the domestic market.
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