Growth in Money Market and Mixed Bond ETFs in Korean ETF Market
Mirae Asset's 'TIGER Money Market Active ETF' has recorded the highest return among money market ETFs over the past month, achieving an annualized yield of 3.57% despite ongoing economic uncertainties. The ETF actively invests in ultra-short-term bonds and seeks to outperform its benchmark, also standing out with a low expense ratio (0.04% per year), net assets of KRW 3.08 trillion, and net inflows of KRW 2.98 trillion over the past year.
Recently, the domestic ETF market has seen a surge in launches of mixed bond ETFs that allocate equally between stocks and bonds. These products are tailored to meet the demand of retirement account investors who wish to maximize their equity exposure within the regulatory '30% safe asset rule.' Of 17 new ETFs listed in the past month, six were of this hybrid type, with portfolios often including leading tech stocks Samsung Electronics and SK Hynix to balance volatility and returns.
Driven by the ongoing semiconductor rally, products like the 'RISE Samsung Electronics SK Hynix Mixed Bond 50 ETF' have attracted large inflows, with KRW 655.5 billion in new funds. The growing competition in the marketplace is further evidenced by the launch of similar hybrid ETFs and increasing capital inflows into AI semiconductor and electric power infrastructure ETFs. Meanwhile, financial institutions are also introducing various deposit products in an effort to attract customers.
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