Kiwoom Asset Management Launches 'KOSEF Korea Value Up'

Kiwoom Asset Management announced on the 31st that it will launch the exchange-traded fund (ETF) ‘KOSEF Korea Value-Up’ on the 4th of next month, in line with the Korean stock market’s corporate value enhancement (value-up) program.

KOSEF Korea Value-Up tracks the ‘Korea Value-Up Index’ calculated by the Korea Exchange. This index was developed as part of the government’s ‘Corporate Value-Up Support Plan’ to encourage market evaluation and investment in companies with excellent corporate value. It consists of 100 stocks that meet criteria such as market representativeness (market capitalization), profitability (excluding loss-making companies), shareholder returns (dividends or share buybacks), market valuation (PBR), and capital efficiency (ROE).

Unlike existing representative indices such as the KOSPI 200, the Korea Value-Up Index limits the maximum weight of individual stocks to 15%. As a result, the influence of mega-cap stocks like Samsung Electronics or SK Hynix on the index is lower compared to existing representative indices, with relatively higher exposure to SK Hynix compared to Samsung Electronics.

KOSEF Korea Value-Up is a passive ETF managed with the goal of closely tracking the performance of the underlying index. It allows stable and transparent tracking of the Korea Value-Up Index, which is expected to benefit from the value-up policy. The total expense ratio is 0.009% per year, which is very low compared to domestic equity ETFs, enabling cost-efficient investment. The average total expense ratio of 358 domestic equity ETFs listed on the Korea Exchange is 0.34%.

Jung Sung-in, head of the ETF Business Division at Kiwoom Asset Management, said, “Since the government’s policy will is strong, value-up will be the biggest topic and growth driver in the domestic stock market for a considerable period,” and added, “If there is demand to invest in domestic indices with growth momentum, it is worth paying attention to the Korea Value-Up ETF.”