[2023 Capital Investment Awards] KB Asset Management, 250 Billion KRW Inflow into TDF This Year... Leading the Asset Management Industry

Best Fund Award for OnGukmin and Dynamic TDF Series

KB Asset Management won the Best Fund Award at the ‘2023 Asia Capital Investment Awards’ for its OnGukmin and Dynamic TDF series.

Since the beginning of the year, approximately 250 billion KRW has flowed into KB Asset Management’s OnGukmin and Dynamic TDF series, marking the largest increase in assets under management among TDF operators. Recently, interest in TDF (Target Date Fund) series has been rising as the default option (pre-designated operation system for retirement pensions) has been fully implemented in the fund market. TDFs are classified as representative pension products.

The domestic TDF market size grew to about 9 trillion KRW last year and has since stagnated. This year, new inflows are around 270 billion KRW, of which 250 billion KRW flowed into KB Asset Management’s TDFs. The reason KB Asset Management showed remarkable growth in the stagnant TDF market is due to proactive marketing efforts ahead of the default option implementation, securing many distributors. The TDF market share, which was 9.8% at the end of last year, expanded to 12%. This was also thanks to steady performance even in volatile market conditions. As of October, KB OnGukmin TDF 2055 posted the highest 3-year return of 37.16%.

KB Asset Management operates two types of products: the passive management strategy ‘KB OnGukmin TDF’ for conservative clients and the active management strategy ‘KB Dynamic TDF’ for clients with a more aggressive profile. KB OnGukmin TDF is a passive fund that offers low fees and low volatility, allowing for high compound returns over long-term investments. The ‘KB Dynamic TDF’ is an active fund that actively responds to market volatility by investing in various assets such as real estate and commodities to swiftly adapt to market conditions.

Due to the nature of TDF funds, investors rarely switch fund managers once enrolled, so it is important to carefully review options at the time of initial subscription. In particular, the compound effect from small differences in fees can be significant, so it is necessary to check the fees of the underlying funds as well. Accordingly, KB Asset Management has lowered TDF fees to the industry’s lowest level. The synthetic total fee of KB OnGukmin TDF is 1.06% per annum, which is more than 0.5% cheaper on average compared to other companies.

Lee Seok-hee, Head of the Pension WM Division at KB Asset Management, said, “It is meaningful that we recorded the largest growth in the first year of the full implementation of the default option,” adding, “Investing in KB Asset Management’s TDF series can offer high compound returns over the long term due to low fees and low volatility.”