KB Asset Management's 'KB Money Market Active' Fund Surpasses 300 Billion Won

Investment in High-Interest Prime Bonds... "No Redemption Fees"
Annualized Yield Approximately 4.37% Level

The net assets of KB Asset Management’s ultra-short-term bond fund, the ‘KB Money Market Active Fund (Bond),’ have surpassed 300 billion KRW. This represents a significant inflow of funds into a bond-type fund amid investment demand that is uncertain about the direction of interest rates and the stock market, leading to a shift toward parking-type exchange-traded funds (ETFs).

KB Asset Management announced on the 15th that as of the 13th of this month, the net assets of the KB Money Market Active Fund (Bond) stood at 310 billion KRW.

The ‘KB Money Market Active Fund (Bond)’ primarily invests in high-interest, high-quality bonds with maturities within approximately three months. Compared to the representative short-term investment product, the money market fund (MMF), it has fewer restrictions on the assets it can hold, allowing for more active asset allocation and, consequently, relatively higher performance.

The fund specifically holds more than 60% in short-term bonds and commercial paper (CP), with liquidity assets and others making up less than 40%. It features no redemption fees, allowing investors to withdraw funds at any time, which is advantageous for liquidity management.

Additionally, while typical domestic short-term bond funds require three business days for redemption, the ‘KB Money Market Active Fund (Bond)’ offers redemption proceeds in just two business days, providing relatively better liquidity. Furthermore, the average maturity of the bonds invested in is shorter than that of general short-term bond funds, resulting in very low volatility in returns due to interest rate changes.

Since its inception, the ‘KB Money Market Active Fund (Bond)’ has recorded an annualized return of approximately 4.37%, outperforming other MMFs.

Lee Seok-hee, Head of Pension WM Division at KB Asset Management, explained, “Unlike bank fixed deposits, which require the agreed period to be completed to receive all interest, the KB Money Market Active Fund (Bond) can yield higher returns than MMFs even with just one day of investment. It is an attractive product for investors seeking short-term investment options.”

The ‘KB Money Market Active Fund (Bond)’ is available for subscription through KB Kookmin Bank, KB Securities, Hanwha Investment & Securities, Mirae Asset Securities, Kiwoom Securities, and Korea Investment & Securities. The annual total fees are approximately 0.235% for Class C and 0.16% for Class C-E. Purchases are priced based on the value two business days from the request date, and redemptions are paid two business days from the request date.