Hantoo Asset Management, ACE US 30-Year Treasury Active Fund... "Top Individual Net Buyer in the Past Year"

Korea Investment Trust Management recently announced on the 30th that the ACE US 30-Year Treasury Active (H) Exchange-Traded Fund (ETF) recorded the highest net purchase amount by individual investors among domestic bond ETFs over the past year.

According to Koscom ETF CHECK, as of the closing price on the 29th, the net inflow of individual investors into the ACE US 30-Year Treasury Active (H) ETF over the past year amounted to 506.5 billion KRW. This is the highest level among 129 domestic bond ETFs listed (excluding leveraged and inverse products). Since the beginning of the year, the net purchase amount by individuals also reached 277.7 billion KRW, ranking first among bond ETFs.

The ACE US 30-Year Treasury Active (H) ETF, launched in March 2023, is the first domestic spot-type US long-term bond ETF product. In March, just over a year after its launch, it became the first ACE ETF to surpass 1 trillion KRW in net assets. Currently, its net assets approach 1.2227 trillion KRW. The benchmark index for this ETF is the Bloomberg US Treasury 20+ Year Total Return Index, which includes US Treasury 30-year bonds with a remaining maturity of 20 years or more.

Its appeal lies in being a monthly dividend product managed through physical holdings rather than synthetic replication. The ACE US 30-Year Treasury Active (H) ETF is a spot-type overseas bond product. When the base interest rate is lowered, investors can expect capital gains on bonds, and based on the interest income generated from the bonds held physically, monthly dividends are also paid.

Additionally, the ACE US 30-Year Treasury Active (H) ETF can be invested in up to 100% within retirement pension accounts such as Defined Contribution (DC) and Individual Retirement Pension (IRP) accounts. Since this ETF physically holds US Treasury 30-year bonds, which have relatively low credit risk, it is suitable for pension investments. It is a product with high satisfaction among investors aiming for stable long-term investment. The annual total expense ratio is 0.05%, the lowest among domestic bond ETFs investing in US long-term bonds, offering significant advantages for long-term investment.

Korea Investment Trust Management recently expanded its lineup of monthly dividend products investing in US 30-year Treasury bonds. The ACE US 30-Year Treasury Active ETF, launched in March, is a currency-exposed product that allows investors to receive foreign exchange gains and bond interest income when the USD/KRW exchange rate rises. The ACE US 30-Year Treasury Yen-Exposed Active (H) ETF, launched simultaneously, invests in both US 30-year Treasury bonds and Japanese yen. Investors can enjoy yen foreign exchange gains as well as capital gains from US Treasury bonds. Both products are spot-type, making the actual costs borne by investors relatively lower compared to synthetic products. The ACE US 30-Year Treasury Yen-Exposed Active (H) ETF is popular among individual investors, with more than half of its current net assets of 72.2 billion KRW (36.5 billion KRW) coming from individual investors.

Nam Yong-su, Head of ETF Management at Korea Investment Trust Management, said, “As the possibility of US interest rate cuts increases, the attractiveness of the ACE US 30-Year Treasury Active (H) ETF is highlighted,” adding, “The biggest advantage is that it can be invested 100% in pension accounts.” He continued, “However, since this product has a long duration, it is sensitive to interest rate changes and has high volatility. We recommend considering investment preferences and asset allocation plans carefully and diversifying by appropriately mixing safe assets.”