Korea Investment Management’s Two Shareholder Value ETFs Surpass 60 Billion KRW in Combined Net Assets

Korea Investment Management announced on April 23 that the combined net asset value of its two so-called "shareholder value exchange-traded funds (ETFs)"?which invest in companies that enhance shareholder value?has surpassed 60 billion KRW. The two products are the ACE Shareholder Return Value Equity Active ETF and the ACE Life Asset Shareholder Value Active ETF.

According to the Korea Exchange, as of April 22, the combined net asset value of the ACE Shareholder Return Value Equity Active ETF and the ACE Life Asset Shareholder Value Active ETF stood at 65.7 billion KRW. The net asset value for each ETF was 38.2 billion KRW and 27.5 billion KRW, respectively.

The ACE Shareholder Return Value Equity Active ETF, listed in November 2022, is characterized by investing in undervalued stocks that possess solid financial indicators and long-term growth potential. The fund is managed by Kim Kibaek, Head of ESG Management at Korea Investment Management, who has visited more than 1,300 companies over the past 10 years.

The ACE Shareholder Return Value Equity Active ETF currently boasts the highest year-to-date return (9.99%) among 18 domestic shareholder value-related ETFs, including Value-up ETFs. Its returns over the past six months and one year were recorded at 14.95% and 15.75%, respectively.

The ACE Life Asset Shareholder Value Active ETF was listed in October last year. It is a product jointly developed by Korea Investment Management and Life Asset Management. Life Asset Management, led by Chairman Lee Chaewon, a first-generation value investor in Korea, is well-known for its mutually beneficial exercise of shareholder rights that fosters growth for both companies and investors.

The ACE Life Asset Shareholder Value Active ETF is co-managed by Korea Investment Management's ESG Management Division and Life Asset Management, focusing on discovering and investing in stocks with outstanding shareholder returns. Both firms closely cooperate in exercising shareholder rights for the included stocks, generating synergy.

The difference between the two products lies in their portfolio composition. As of the previous day, the top holdings of the ACE Shareholder Return Value Equity Active ETF were relatively small- and mid-cap stocks, including SeAH Steel Holdings (9.54%), Youngone Holdings (7.83%), DoubleUGames (7.48%), and SeAH Steel (6.34%). The ACE Life Asset Shareholder Value Active ETF's major holdings included DN Automotive (8.54%), Orion (8.39%), BNK Financial Group (5.47%), and Korea Financial Group (4.70%).

Nam Yongsoo, Head of ETF Management at Korea Investment Management, stated, "By utilizing the two ACE ETFs, investors can achieve balanced exposure from large-cap to small- and mid-cap stocks that are actively working to enhance shareholder value." He added, "As the market's efforts to resolve the so-called 'Korea Discount' are gaining momentum, the ACE Shareholder Return Value Equity Active ETF and ACE Life Asset Shareholder Value Active ETF are worth paying attention to."

Both the ACE Shareholder Return Value Equity Active ETF and the ACE Life Asset Shareholder Value Active ETF are performance-based dividend products, and past performance does not guarantee future results. Investors should also be aware that principal loss may occur depending on investment outcomes.