DS Asset Management and Midas Asset Management launched KOSDAQ active exchange-traded funds (ETFs) in May as small and mid-sized asset managers target South Korea's rapidly growing ETF market. DS Asset Management released 'DS KOSDAQ Active' on May 14 as its first ETF, while Midas Asset Management introduced 'MIDAS KOSDAQ Active' on May 19. The Korean ETF market's total net assets surged from 152.6 trillion won at the end of June two years ago to 512.4 trillion won at the end of June this year, according to KOSCOM ETF Check data reported by the financial investment industry on the 19th.
DS Asset Management Launches First ETF Targeting KOSDAQ Growth Sectors
DS Asset Management, known as a private investment specialist, launched 'DS KOSDAQ Active' on May 14 as its first ETF product. The ETF concentrates investments in leading stocks within structural growth industries in the KOSDAQ market. Unlike passive ETFs that track benchmark indices, this active product selects stocks and adjusts weightings based on portfolio manager judgment to pursue excess returns compared to the benchmark index.
Holdings with weightings above 5% as of May 15 include Tess (8.87%), VM (7.67%), PSK (7.59%), and PSK Holdings (7.56%). The portfolio composition reflects the judgment that increased memory semiconductor facility investments driven by expanding artificial intelligence (AI) demand will benefit materials, parts, and equipment companies.
DS KOSDAQ Active closed up 3.49% from its base price on May 14, while the KOSDAQ index fell 1.92% on the same day. On May 15, the ETF rose 5.85%, slightly outpacing the KOSDAQ index gain of 5.80%. On May 16, the ETF fell 6.65%, recording a larger decline than the KOSDAQ index drop of 4.53%.
Midas Asset Management KOSDAQ Active ETF Records Relative Outperformance
Midas Asset Management launched 'MIDAS KOSDAQ Active' on May 19. Since listing, MIDAS KOSDAQ Active declined 15.84%, while the KOSDAQ index plunged 28.73% during the same period.
Korean ETF Market Total Assets Triple in Two Years
According to KOSCOM ETF Check, ETF total net assets increased rapidly over the past three years. Assets stood at 152.6 trillion won at the end of June two years ago, 210.2 trillion won at the end of June last year, and 512.4 trillion won at the end of June this year.
Small Asset Managers Target Information Asymmetry in KOSDAQ Market
Small and mid-sized asset managers pursue differentiation strategies through KOSDAQ active ETFs. DS Asset Management emphasized at a press conference held on the 10th that KOSDAQ is the market where the company can best demonstrate its strengths. The explanation notes that corporate analysis capabilities translate into performance differences because information asymmetry is significant in the KOSDAQ market where institutional research is insufficient. DS Asset Management, led by Chairman Jang Deok-soo known as a 'master of private investment,' has established its position in the private investment industry.
KOSDAQ Index Decline Presents Challenge Despite Recovery Expectations
KOSDAQ market underperformance poses a challenge. This year, the KOSPI index rose 61.85% while the KOSDAQ index fell 14.44%. The industry maintains expectations for KOSDAQ index recovery potential. Forecasts suggest that government policies including removal of underperforming companies and institutional funds including the National Growth Fund will serve as key drivers for KOSDAQ index gains.
FAQ
What did DS Asset Management launch on May 14?
DS Asset Management launched 'DS KOSDAQ Active' on May 14 as its first ETF product. The active ETF concentrates investments in leading stocks within structural growth industries in the KOSDAQ market and adjusts holdings based on portfolio manager judgment to pursue excess returns.
How did the Korean ETF market grow over the past three years?
According to KOSCOM ETF Check, Korean ETF total net assets increased from 152.6 trillion won at the end of June two years ago to 210.2 trillion won at the end of June last year and 512.4 trillion won at the end of June this year.
How did KOSPI and KOSDAQ indices perform this year?
This year, the KOSPI index rose 61.85% while the KOSDAQ index fell 14.44%.
