KB Asset Management, No.1 in Domestic Bond ETF Returns

[Asia Economy Reporter Park So-yeon] Since the beginning of the year, as the base interest rate is expected to approach its final level, market interest rates have fallen, significantly improving the returns of bond exchange-traded funds (ETFs). In particular, the performance improvement of bond ETFs with long durations is remarkable.

On the 8th, KB Asset Management announced that the 'KBSTAR KIS Treasury Bond 30-Year Enhanced ETF' recorded a 3-month return of 25.43%, ranking first among 75 domestic bond ETFs.

The year-to-date return is also 13.01%, ranking first among domestic bond ETFs.

The ‘KBSTAR KIS Treasury Bond 30-Year Enhanced ETF’ is an ETF that tracks the daily returns of the KIS Treasury Bond 30-Year Enhanced Index at a 1x leverage. Since last October, individual net purchases have reached 49 billion KRW, showing high interest from individual investors.

As a bond ETF with a long duration of 24.76 years, it can expect high capital gains if interest rates decline in the future.

Geum Jeong-seok, Head of ETF Marketing at KB Asset Management, said, "Interest in bond ETFs with long durations has increased among investors seeking high capital gains by leveraging recent bond market volatility. However, since outlooks on the upper limit of interest rates vary and high volatility is expected in the bond market depending on the earnings results of major U.S. big tech companies, we recommend a strategy of phased buying while monitoring interest rate conditions."

Meanwhile, KB Asset Management, which preemptively launched the 30-year bond ETF in 2021 to capture the market, plans to launch the ‘KBSTAR Treasury Bond 30-Year Leverage KAP (Synthetic) ETF,’ which tracks twice the yield of the 30-year government bond, on the 14th, marking the first such product in Korea.