Samsung Asset Management: "In Q1, 'Tokki (RABBIT) ETF' Jumped Significantly"

‘Renewable Energy’ and ‘Artificial Intelligence’ ETFs
Achieve Average Returns Exceeding 30% Since the Beginning of the Year

Samsung Asset Management announced on the 5th that ETFs corresponding to the investment keyword ‘R.A.B.B.I.T.’ selected by KODEX recorded excellent returns of up to 53.7% since the beginning of 2023, the Year of the Rabbit.

In January, Samsung Asset Management selected ‘R.A.B.B.I.T.’ as the investment keyword that investors should focus on this year. The investment keyword ‘R.A.B.B.I.T.’ consists of six investment areas, each representing ‘Renewable Energy’, ‘Artificial Intelligence (AI)’, ‘Bond’, ‘Beyond Covid-19 (China)’, ‘Income generation’, and ‘Tech-politics’.

Among these, ETFs related to ‘Renewable Energy’ and ‘Artificial Intelligence (AI)’ recorded high returns of approximately 32-33% on average since the beginning of the year. This is interpreted as a result of the US Federal Reserve beginning to moderate the pace of monetary tightening, leading to a rapid rebound in the stock prices of eco-friendly and AI-related companies that will drive future growth.

First, among renewable energy ETFs related to secondary batteries, solar power, and wind power, ▲KODEX Secondary Battery Industry posted a 53.7% return, and ▲KODEX K-Renewable Energy Active showed a 30.9% return in the first quarter. Following the US Inflation Reduction Act (IRA), the European Union (EU) is promoting the Critical Raw Materials Act (CRMA) and the Net-Zero Industry Act, signaling global commitment to nurturing companies and technologies in the eco-friendly industry, making renewable energy a continuously noteworthy investment sector.

Additionally, with the emergence of ChatGPT and the spread of robotics technology in industrial and service fields, ETFs in the ‘Artificial Intelligence (AI)’ sector have rapidly grown, with ▲KODEX K-Robot Active achieving a 37.4% return and ▲KODEX US Semiconductor MV ETF posting a 36.3% return in the first quarter.

Furthermore, ‘Bond’, ‘Income generation’, and ‘Tech-politics’ also delivered meaningful performance within investment portfolios as safe assets and representative US products. Although the ‘Beyond Covid-19 (China)’ sector experienced a delay in the reopening effect in China, it is expected to reflect solid performance from the second half of the year onward, warranting continued attention.

Samsung Asset Management forecasted that concerns about the banking system, centered on the US and Europe, will continue after the second quarter, and market expectations that the Federal Reserve’s rate hike cycle may end sooner than anticipated will improve investment sentiment toward risk assets. Accordingly, long-duration bonds in the bond sector and fundamentally strong blue-chip growth stocks in equities are expected to attract more attention.

Ahn Jeong-jin, head of Samsung Asset Management’s ETF Consulting Team, said, “We selected ‘R.A.B.B.I.T.’ as the ETF trend keyword to watch in the Year of the Rabbit 2023, and true to the name ‘Rabbit,’ most ETFs saw a leap in first-quarter returns. Considering market volatility through the end of the year and the high likelihood that the Fed’s rate hikes will conclude within the year, the R.A.B.B.I.T. ETF investment trend deserves continuous attention.”