Korea's ETF Market Surpasses 400 Trillion Won Amid Regulatory and Industry Shifts
The Korean exchange-traded fund (ETF) market has exceeded 400 trillion won in assets under management, showcasing rapid expansion. Daily increases in trading volume, often reaching 1 trillion won, highlight individual investors’ strong preference for ETFs due to their low costs and accessibility. Product diversity and total trading value are rising quickly, with the broader Kospi index expansion allowing for more investment opportunities through ETFs.
Asset management firms are now focusing on expanding the active ETF market. Timefolio Asset Management achieved the third-highest revenue from management fees thanks to its high fee structure, whereas passive ETFs tend to be less profitable due to lower fees. Regulatory authorities are considering easing restrictions for the introduction of fully active ETFs, though experts warn that higher fees alone do not guarantee profitability, and that asset management capabilities remain key.
Meanwhile, the Korea Exchange has announced stricter listing reviews for active ETFs to reduce investor confusion. Cases have arisen where ETFs referencing indices such as Nasdaq or Kospi actually hold unrelated assets, frustrating investors. Thus, future prospectuses will require clear risk warnings and disclosure of investment themes, and discrepancies between ETF names and strategies must be transparently communicated to investors.
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Exhausted by 1bp Fee Cutthroat Competition… Asset Management Firms Bet on 'Active ETFs'Asset management companies are keen on expanding the active Exchange Traded Fund (ETF) market. As the fierce competition with a fee of 1bp (0.01%) continues in the passive ETF sector, active ETFs, which offer higher fees while allowing for management differentiation, are emerging as a profitable breakthrough. According to the ETF transaction status from Yonhap Infomax on the 20th (screen number 7111), the total net assets of domestic ETFs exceed 400 trillion won. Among this, the net assets of TIME Portfolio Asset Management amount to about 6 trillion won, accounting for only 1.5% of the total. The number of products is 18 compared to 109 managed by Korea Investment Management.
[Editorial] Rapidly Growing Short-term ETFs: Are There Any Issues with Excessive Concentration? - EdailyThe domestic exchange-traded fund (ETF) market is rapidly growing. The net asset value has recently surpassed 400 trillion KRW, driven by the recovery trend of the KOSPI index. This growth has happened just over three months after it exceeded 300 trillion KRW at the beginning of the year. It's increasing by about 1 trillion KRW per day. Despite the conflict between the U.S. and Iran, 'money inflow' into the stock market ...