Shinhan Asset Management, Shinhan Short-Term Bond Fund... "Assets Under Custody Surpass 1 Trillion"

Shinhan Asset Management announced on the 21st that the 'Shinhan Ultra Short-Term Bond Fund' has surpassed 1 trillion KRW in assets under management. It achieved 1 trillion KRW in AUM within six months since its launch at the end of May this year. Over the past three months, 260 billion KRW has flowed in, showing the fastest growth among ultra short-term bond fund types.

According to the fund rating agency Zeroin, as of the previous day, the 'Shinhan Ultra Short-Term Bond Fund' recorded a 3-month annualized fund return of 3.75%. As a representative parking-type product, the Shinhan Ultra Short-Term Bond Fund offers the same liquidity as MMFs, allowing next-day subscription (T+1) and next-day redemption (T+1). There are no redemption fees. Compared to MMFs, it pursues excess returns by employing various strategies through more flexible investments.

The Shinhan Ultra Short-Term Bond Fund has a differentiated management strategy. It actively responds to interest rate volatility by maintaining a short duration of 90 to 180 days for the bonds included. Based on Shinhan Asset Management’s unique bond management capabilities, it carefully analyzes corporate fundamentals to select and concentrate investments in undervalued credit bonds (AA-, A2-). Additionally, its core management strategy is a relative value approach that seeks additional returns by selling overvalued securities and buying undervalued ones.

With recent increased volatility in the stock market and the ongoing high interest rate environment since last year, the market demand is concentrating on ultra short-term bond funds that can offer relatively high interest rates. Ultra short-term bond products have the advantage of relatively low volatility and the ability to secure high interest rates amid the Bank of Korea’s interest rate cut cycle and expanding market volatility.

Song Hansang, head of the Bond Management Team 2 at Shinhan Asset Management, said, “It is expected that the base interest rate will be cut two to three more times in 2025,” adding, “With interest rate cuts in both the U.S. and Korea, ultra short-term bonds with relatively longer durations than MMFs are likely to be more advantageous in terms of returns.” He continued, “We plan to consistently maintain high fund returns by discovering and investing in undervalued securities with high-grade stability through thorough credit analysis.”