Rapid Growth and Transformation in the South Korean ETF Market
The South Korean exchange-traded fund (ETF) market has seen explosive growth, crossing into the 250 trillion KRW territory. As a result, the number of ETFs with assets exceeding 1 trillion KRW has surged from 26 last year to 53 currently, accounting for 5.2% of the total ETF market. After surpassing 200 trillion KRW by the end of last year, the market hit the 250 trillion KRW mark by early October this year, reflecting a vibrant investment environment.
The growth in the ETF market is largely driven by an increase in retail investors shifting towards U.S. equity ETFs. This shift has significantly bolstered the popularity of certain funds, notably the 'TIGER U.S. S&P500', which has become the top-ranking ETF in terms of net assets. This change highlights the trend of individual investors opting for stable and cost-effective financial investment products such as ETFs.
ETFs within what is known as the '1 Trillion Club' continue to be a significant marketing and investment standard within the financial investment industry. Companies in the sector are maintaining their business strategies based on this benchmark. Additionally, there will be a need for diverse technological and product innovations to activate and adapt to the growing market.
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