KIM spruces up 3 equity funds to meet diverse investor needs

2021. 1. 28. 16:56
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A logo of Korea Investment Management's parent company Korea Investment Holdings

Seoul-based investment house Korea Investment Management said Thursday that it has rebranded three open-ended equity funds to cater to the diversified needs of South Korean retail investors.

The three open-ended equity funds have ditched their respective strategies and shifted their focus to the domestic technology sector; to sectors benefiting from the Korean New Deal initiative, such as batteries, biotechnology, internet and games; and to environmental, social and governance factors.

According to KIM, the technology-focused fund will bet on a subsector momentum of Korean tech manufacturers. The fund, with exposure to the so-called “BBIG” sectors, will invest in companies with the potential for market dominance and with high barriers. On the other hand, its ESG fund will benchmark the performance of MSCI Korea IMI ESG Screened Capped Index.

The facelift of the three funds, with a combined 27.3 billion won ($24.5 million) in assets under management as of now, is designed to offer more sophisticated choices to retail investors here, whose participation virtually drove the recent stock rally here, KIM officials said.

“Stock funds have stopped short of addressing demands of investors, and investors were faced with a number of choices other than stock funds,” said Jung Sang-jin, head of equity at KIM, in a teleconference with reporters. “Our response was to come up with new types of funds to appeal to clients simultaneously.”

While investors flocked to buy new stocks on the back of high cash liquidity, Korean stock funds have seen a faster net outflow in 2020. According to data from the Korea Financial Investment Association, publicly raised stock funds investing in Korean firms recorded a 5.5 trillion won net outflow, having doubled over a year. This shows a contrast with the pile-up of dry powder for investors’ equity investment, which surged 140 percent on-year to 65.5 trillion won.

KIM is the sixth-largest asset management firm in Korea, managing some $55 billion assets as of end-2020.

By Son Ji-hyoung (consnow@heraldcorp.com)

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