Koscom Reports 30% Increase in RA Subscribers in Q4 Last Year

[Asia Economy Reporter Park Jihwan] The robo-advisor (RA) market recorded rapid growth in the fourth quarter of last year. The number of subscribers increased by nearly 30% in just one quarter, and the subscription amount also showed growth of over 10%.

According to the Koscom Robo-Advisor Testbed Secretariat on the 25th, the number of RA subscribers in the fourth quarter of last year increased by 29.55% compared to the previous quarter. The subscription amount also rose by 11.98%. Although the third quarter of last year also saw steady growth with subscriber numbers and subscription amounts increasing by 2.91% and 7.94%, respectively, it is analyzed that the frequency of RA subscriptions significantly increased due to efforts to popularize customized asset management services by investment advisory firms and asset management companies. In particular, during the same period, the scale of paid advisory-type RA subscriptions increased by 119.53%, and the scale of paid discretionary-type RA subscriptions also grew by 27.29%.

The returns were also relatively high. Last year, the domestic stock RA posted a return of 27.30%, outperforming overseas stock RA returns. The average return of domestic stock RA (aggressive investment type) last year was 27.30%. Although this did not reach the KOSPI return of 30.75% during the same period, all portfolios?stability-seeking (8.14%), risk-neutral (14.00%), and aggressive investment (27.30%)?showed favorable performance.

On the other hand, overseas stock RA recorded negative returns. Stability-seeking (-3.53%), risk-neutral (-5.26%), and aggressive investment (-11.74%) returns were reported. This was attributed to the RA algorithm incurring foreign exchange losses due to the won’s appreciation and the dollar’s depreciation in the fourth quarter.

A Koscom official stated, "The RA algorithm product, a representative mid-risk mid-return product domestically, grew both qualitatively and quantitatively last year as the KOSPI entered the 3000 era. Even if a correction possibility is highlighted in the first quarter of this year following the short-term surge in the second half of last year, it is expected to realize relatively superior performance."