[2023 Asia Fund Awards] "Reviving Investor Sentiment, Expected to Serve as a Compass for Finding New Investment Destinations"

[Asia Economy Reporter So-yeon Park] With expectations that the interest rate hike cycle is coming to an end, the net assets of exchange-traded funds (ETFs) have surpassed 90 trillion won, revitalizing investor sentiment in the fund market. As dormant standby funds are moving to find investment destinations, the Asia Economy Fund Awards is taking a step forward by identifying companies that have strived to improve customer returns across various investment sectors.

Asia Economy conducted a comprehensive review of the fund market, which is attracting increasing attention from investors ahead of the upcoming changes in the capital market. At the 14th Asia Fund Awards, outstanding fund products and asset management companies were selected and awarded in sectors including target date funds (TDFs), which are representative products for balanced and stable life planning, as well as ETFs, retirement pensions, and REITs, which have garnered strong investor interest.

The grand prize winner of this year’s Asia Fund Awards was Mirae Asset Global Investments. Mirae Asset’s total assets under management (AUM) reached 250.5 trillion won, with overseas investment assets exceeding 100 trillion won, ranking first among domestic asset management companies. It has established a broad global network across 15 countries. Pension assets under management stand at 11.6 trillion won, capturing a 28% market share in the pension fund market. The total ETF AUM also surpassed 100 trillion won, with more than 400 ETF products in total.

Mirae Asset Global Investments also stood out in the retirement pension sector. Since the implementation of the default option in July last year, the Ministry of Employment and Labor approved a total of 259 default option-eligible retirement pension products through first and second rounds of review. Among these, 130 products are from Mirae Asset. Mirae Asset is the only company with over 100 approved products among all asset managers. It was selected as a top asset manager in the FnGuide comprehensive evaluation and received high marks for its overwhelming cash inflow compared to other asset managers, leading to its grand prize selection.

For the best TDF (equity-mixed) asset managers, KB Asset Management and Shinhan Asset Management were chosen. Since the launch of 'KB Dynamic TDF,' KB Asset Management has maintained stable performance. Among the nine TDF series currently managing over 100 billion won each, the 2030 and 2040 series ranked first in one-year returns, while the 2050 series ranked second. This was achieved by lowering the proportion of currency hedging during the strong dollar period and actively allocating assets to efficiently respond to stock market declines. The product uses a glide path developed in collaboration with Seoul National University’s research lab, considering both life cycle and market conditions simultaneously. It features diversified investments not only in global stocks and bonds but also in alternative assets such as real estate and commodities to pursue additional returns.

Shinhan Asset Management’s TDF series has shown a steady upward trend since its domestic debut in 2017. As of January 1 this year, the total assets under management amounted to 741.1 billion won. Last year alone, more than 170 billion won flowed into the Shinhan TDF series, ranking second in net inflows among the top five TDF managers by assets under custody. It showed the highest growth rate compared to the previous year. Notably, Shinhan Asset Management stood out for its communication with the MZ generation. In June last year, it newly launched the Shinhan Ma-eum Pyeonhan TDF 2055, which adopts an aggressive investment approach during the early asset-building phase and gradually shifts to safer investments as the retirement target year 2055 approaches. Furthermore, reflecting diverse customer demands, it added a long-term growth TDF that allows continued investment beyond the target date. Shinhan Asset Management is striving to diversify its TDF funds to supply products that meet the evolving needs of its customers.

NH Nonghyup REITs Management was selected as the best asset manager in the REITs sector. NH REITs operates two listed REITs tailored to investors’ risk preferences. The conservative NH Prime REIT, listed in December 2018, currently manages assets worth 93.3 billion won. It is the first domestic re-listed REIT, providing general investors with opportunities to invest in prime office buildings in Korea. The income-seeking NH All One REIT, listed in 2021, manages assets totaling 603 billion won. It invests in diverse sectors including core offices, logistics, and retail. NH All One REIT enhanced its growth potential last year by incorporating two new physical assets (A-One Tower Geumnamro Building, A-One Tower Gwangju Station Building) and one income security (NH Retail REF No.1). In August last year, it established NH7 REIT, a subsidiary REIT of NH All One REIT (parent REIT), increasing AUM by 90 billion won. Its efforts to improve the intrinsic value of managed assets, such as stable vacancy management and increased rental income leading to consecutive excess dividends, received high praise.

Samsung Asset Management was chosen as the best asset manager in the ETF sector. Among the approximately 90 trillion won domestic ETF market, KODEX accounts for about 38 trillion won, holding over 40% market share. Samsung Asset Management launched KODEX200 in 2002, the first domestic ETF, and has invested heavily in product and system development, investor education, and marketing expansion to establish ETFs as a popular financial product. Since its launch, it has consistently maintained the number one market share. Following the KOSPI 200 ETF listing in 2002, it was the first in Korea to list overseas ETFs in 2007, bond ETFs in 2009, and Asia’s first inverse and leveraged ETFs in 2009 and 2010, respectively, becoming a leading ETF manager not only in Korea but also in Asia. It has also launched smart beta ETFs by analyzing sources of excess returns and introduced Korea’s first long-short ETF and equity active ETFs in 2020, continuously providing innovative investment solutions. These efforts have been highly evaluated for expanding investors’ possibilities to achieve their investment goals through ETFs.

Mirae Asset Global Investments was selected as the best asset manager in the retirement pension sector simultaneously with winning the grand prize. As of the end of last year, Mirae Asset’s retirement pension fund assets under custody reached 7 trillion won, maintaining a dominant lead over the second place and holding the industry’s top position. The company’s long-term focus on pension business as a core operation for over 20 years has translated its pension management know-how into product competitiveness. It has recorded excellent long-term performance based on in-house management. With 13 years of pension product management experience, it has achieved high returns. A key difference between in-house and outsourced management is the total fees of the product. In-house management eliminates fees paid to external managers, benefiting investors. Since fees can impact long-term returns for products like retirement pensions, Mirae Asset’s pension management expertise was highly regarded in selecting it as an awardee.

Korea Investment Management was selected as the best asset manager in the overseas fund sector. Korea Investment Management entered the Vietnamese market in earnest by establishing a research office in Vietnam in 2006 and launched the country’s first Vietnam investment fund in March of the same year. It became the world’s second-largest Vietnamese equity management company in 2018. In 2020, it established a local corporation in Vietnam and operates Vietnam funds with assets under management exceeding 1.2 trillion won (as of the end of 2022) through about 30 personnel, including more than 15 Vietnamese specialized management and research staff. The total assets under management of Vietnam funds amount to 921 billion won (FnGuide, as of January 10, domestic products basis). These funds invest in sectors benefiting from Vietnam’s sustained economic growth, such as infrastructure, real estate projects, and domestic demand growth stocks. Korea Investment Management’s Vietnam funds were recognized for their overwhelmingly large scale and growth potential compared to other asset management companies.

Professor Soon-seop Jung of Seoul National University Law School, who served as the judge for this year’s Asia Fund Awards, said, "In the challenging market conditions over the past year, the efforts of fund market participants, including asset managers and distributors, for innovation and development shone even brighter." He added, "We hope the Asia Fund Awards will serve as a compass for financial investment companies active in the fund market and investors seeking new investment destinations."