KODEX US Semiconductor MV Surpasses 100 Billion KRW in Net Assets

Samsung Asset Management's ‘KODEX US Semiconductor MV’ ETF (Exchange Traded Fund) surpassed 100 billion KRW in net assets as of the 10th.

According to Samsung Asset Management on that day, this product follows the same underlying index as VanEck Semiconductor (SMH) ETF, the largest US semiconductor ETF with a scale of about 13 trillion KRW. In the first half of last year, SMH, which tracks the MV Semiconductor Index in the US, overtook SOXX, which follows the ICE Semiconductor Index, to become the world's largest semiconductor ETF, and showed an overwhelmingly larger scale difference compared to SOXQ, which tracks the Philadelphia Semiconductor Index.

The KODEX US Semiconductor MV ETF invests in leading global semiconductor companies listed in the US. It comprehensively invests in the semiconductor industry sectors such as fabless, foundry, memory semiconductors, and system semiconductors, currently including 25 major global semiconductor companies. Since its listing in June 2021, it has steadily grown based on not only a fee about one-fifth that of similar products but also excellent return performance.

This year’s one-year return was 47.4%, the highest among domestically listed semiconductor ETFs. The return since the beginning of the year is 59.1%. The advantage of the underlying index of KODEX US Semiconductor MV, the ‘MV Semiconductor Index,’ is that unlike some similar products with a maximum investment limit of 8% per stock, it can invest intensively up to about 20%, allowing concentrated investment in industry-leading companies. Currently, it includes NVIDIA, a beneficiary stock related to artificial intelligence (AI) semiconductors, at about 19%.

Additionally, about 50% is allocated to stocks other than the top five to ensure that the returns of excellent companies with high stock price potential are not missed. The return performance increases with long-term investment, showing 13.1%, 18.4%, and 39.0% higher returns over 1, 3, and 5 years respectively compared to the Philadelphia Semiconductor Index (SOX Index), which is better known domestically than in the US.

The largest US semiconductor ETF, SMH ETF, has a total expense ratio of about 0.35% per year, whereas KODEX US Semiconductor MV is 0.09% per year. This means that investing 10 million KRW for a whole year incurs a cost of 9,000 KRW. Starting this year, it conducts quarterly distributions, making it a product that allows long-term investment with low fees while also aiming for an annual distribution yield of about 1.22%.

Kim Sunhwa, head of ETF Operations Team 2 at Samsung Asset Management, said, "It will be a good representative product for many investors considering US semiconductor investment domestically," adding, "Especially with a low fee of 0.09% per year, it is more suitable for investors who wish to make long-term investments in the growing semiconductor industry."