Samsung Asset Management announced on the 20th that the KODEX CD Interest Rate Active ETF ranked first among 828 ETFs with net assets of 7.4 trillion KRW just eight months after its listing.
Since its launch in June last year, funds from both institutions and individual investors have rapidly flowed in, continuously breaking records for net asset growth. The KODEX CD Interest Rate Active ETF secured the top spot among all ETFs based on net assets in just 172 trading days. Accordingly, it also set a new record for the shortest time to reach the top position, surpassing existing products in just over eight months since listing.
The cumulative net purchases by individual investors reached 373.8 billion KRW, making it the largest among 11 parking and interest rate ETFs. During the same period, it ranked third among all ETFs. Considering that the KODEX CD Interest Rate Active ETF accounts for about 27% of the total net assets of 26.5 trillion KRW among the 11 parking and interest rate ETFs, the proportion of individual investors’ cumulative net purchases amounts to 37% of the total 1 trillion KRW, indicating a strong preference among individual investors.
The reason for the concentrated net buying by individual investors is analyzed to be that this product is the only one that meets all the conditions of a true parking-type product: high returns, stability, and trading convenience based on low actual transaction costs and abundant liquidity.
Similar to the United States, South Korea has experienced an inverted yield curve where the 1-year government bond yield is higher than the 3-year and 5-year government bond yields. Recently, mixed expectations and disappointments regarding interest rate cuts have caused an inverted yield curve in CD rates as well, with the 91-day CD rate maintaining the highest level at an annualized 3.68%, drawing more attention as a ‘parking’ product for investors.
Additionally, since the KODEX CD Interest Rate Active ETF calculates the daily 91-day CD rate on a pro-rata basis and compounds it daily, investors can earn the equivalent of one day’s 91-day CD rate even if they invest for just one day without any period conditions. In fact, since its listing in June last year, it has provided an average daily profit of 154 KRW per share over 172 trading days without any losses.
Moreover, despite having the highest price per share at 1,027,215 KRW, it applies the same 5 KRW bid-ask spread as other ETFs and offers abundant buy and sell quotes. This means investors can buy or sell this product anytime during the day with only about 5 KRW of actual transaction cost, without worrying about price fluctuations, which is a significant advantage.
Due to these advantages, the KODEX CD Interest Rate Active ETF surpassed net assets of 3 trillion KRW, 5 trillion KRW, and 7 trillion KRW in the shortest time since its listing in June last year, and its no-loss record of 172 trading days is also the highest ever.
Im Tae-hyuk, Executive Director of the ETF Management Division at Samsung Asset Management, said, “We consider it very meaningful that the KODEX CD Interest Rate Active ETF ranked first among all ETFs just eight months after its launch in the parking-type ETF market, which began to grow rapidly after the world’s first no-loss interest rate ETF, KODEX KOFR Interest Rate Active, was listed in 2022.” He added, “KODEX ETFs will continue to strive to provide innovative products that meet the diverse and changing investment demands of investors.”
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