[Exclusive] NPS finishes rebalancing new benchmark

By Kwang-Ho Lee

The National Pension Service (NPS) is one of the biggest investors in domestic stock market.

Although the NPS has reduced the proportion of domestic stocks from its investment portfolio, the size of its investment still accounts for 6 percent of the entire market cap of the Korean stock market.

Against this backdrop, it was confirmed that the state-run pension fund began investing in additional 50 stocks from this year.

The NPS is known for investing in a group of stocks in accordance with its benchmark.

It rebalanced its benchmark recently, following its announcement in July 2021 that it would make investments in accordance with a newly developed index named NPS-KR250.

At that time, the pension fund said the new index will include the KOSPI 200 stocks and 50 additional stocks listed on the KOSPI market.

It was confirmed that the NPS finished choosing the 50 stocks late last year and began investments in those stocks from January this year.

As a result, the pension fund has been able to flow into the 50 stocks from the KOSPI 200 stocks.

In other words, its investments in the KOSPI 200 stocks will be decreased, while its investments in the 50 stocks will go up.

The rebalancing will not affect investments by asset managers entrusted with money from the NPS. It will only affect the pension fund’s direct investments.

The NPS does not disclose the names of the 50 stocks, but market insiders can guess them.

Among the 100 stocks that the NPS made the largest net purchase in January, there were 26 stocks that are not included in the KOSPI 200 stocks.

By industrial sectors, the 26 stocks included four rechargeable battery stocks, four biotech stocks, three city gas stocks, three airline stocks and three semiconductor stocks.

Samchully, Jeju Air, Jin Air, Dentium and Hyundai Electric are the five stocks that the NPS made the largest net purchase last month.

However, it seems to take a couple of months to verify whether those stocks are among the 50 stocks chosen by the NPS.

*This was translated from the article originally written in Korean. For more accurate information, please refer to the original version by using the link below. In case of discrepancies between the two versions, the Korean version shall prevail(https://biz.sbs.co.kr/article/20000101553)

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