Impact of Lee Jae-myung Administration's Stock Market Boost Policies on Value-Added ETFs
The Lee Jae-myung administration's new policies aimed at boosting the stock market have captivated investors, elevating interest in value-added exchange-traded funds (ETFs). KB Asset Management's 'RISE Korea Value-added ETF' has experienced a significant increase in trading volume and stock price following the election of President Lee, drawing considerable investor attention. This ETF tracks the Korea Value-added Index, which is built by assessing the size and profitability of companies.
Asset management firms are offering a variety of ETFs that follow the Korea Value-added Index. This index was recently revised to reduce the number of companies from 105 to 100 and includes firms with low Price-to-Book Ratios (PBR) that are also engaging in actions such as increasing dividends, buying back their shares, and improving corporate governance. These characteristics make such ETFs appealing to investors seeking undervalued quality stocks in the current market.
Amidst the anticipation surrounding the new capital market policies, the ETF market has surpassed a total scale of 200 trillion won. Investors hold high expectations on how these policies might further open investment opportunities in undervalued quality stocks. Such market movements are poised to have a positive impact across the Korean stock market landscape in the foreseeable future.
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