Shinhan Asset Management's 'SOL US AI Software' Surpasses 100 Billion KRW in Net Assets

Shinhan Asset Management recently announced on the 10th that the net assets of the 'SOL US AI Software' Exchange Traded Fund (ETF) have surpassed 100 billion KRW. Over the past month, net purchases by individual investors have reached approximately 60 billion KRW.

This buying momentum is attributed to the favorable performance of the ETF driven by the stock price increases of major holdings such as Palantir and Salesforce. As of the previous day, the 1-month, 3-month, and 6-month returns of the SOL US AI Software ETF were 14.61%, 39.44%, and 44.49%, respectively, with the 6-month return ranking first among 40 AI-related ETFs.

Shinhan Asset Management plans to change the underlying index methodology in line with the regular rebalancing date, reducing the maximum weight of individual stocks in the index from the current 20% to 10%. This change will be reflected on January 6 next year, based on the status as of the 31st of this month.

Kim Jeong-hyun, Head of the ETF Business Division at Shinhan Asset Management, stated, "Recently, small and mid-cap AI software companies are emerging in the US market based on their technological capabilities," adding, "This adjustment aims to efficiently reflect the performance of small and mid-cap stocks rather than concentrating on large-cap stocks."

He explained, "Unlike the semiconductor industry, where certain companies have dominant control, the AI software industry features competitiveness across various companies in diverse fields. Therefore, even small and mid-cap companies have the potential to gain prominence in the future," and added, "With the renewed methodology, we expect to construct a broader universe and diversify the constituent stocks."

Meanwhile, the SOL AI Software ETF is the only AI software-related ETF in Korea and is well-suited to respond to changes in the AI cycle. Major constituent stocks include △Microsoft (17.19%) △Salesforce (9.49%) △Palantir (7.96%) △Oracle (7.79%) △ServiceNow (7.51%). After the regular rebalancing, Microsoft’s weight will be reduced, while the weights of small and mid-cap stocks such as Palantir, ServiceNow, and Fair Isaac are expected to increase slightly.

Kim emphasized, "With the upcoming regular rebalancing of the S&P 500 index at the end of December, which includes the new addition of Workday, the leadership of AI software is being reinforced, confirming the need for continued interest in the industry," and added, "Many of the recently emerging AI software companies are relatively small and mid-cap stocks, making it difficult to invest in individual stocks, so utilizing ETFs is effective."