Korea Investment Management's ACE US S&P500 ETF Surpasses 2 Trillion Won in Net Assets

Korea Investment Management announced on May 15 that the net asset value of the ACE US S&P500 Exchange Traded Fund (ETF) has surpassed 2 trillion won.

According to the Korea Exchange, as of May 14, the net asset value of the ACE US S&P500 ETF stood at 2.0939 trillion won. This ETF, which tracks the leading US index, was listed by Korea Investment Management in August 2020 and is based on the Standard & Poor's (S&P) 500 Index.

The growth of the ACE US S&P500 ETF is attributed to net buying by individual investors. According to the Korea Exchange, the net buying amount by individual investors in the ACE US S&P500 ETF so far this year has reached 263.6 billion won. During the same period, the average net buying amount by individual investors for the 15 S&P500 ETFs listed in Korea (excluding newly listed ETFs this year) was only 141.3 billion won.

The lower actual expense ratio compared to similar products has also contributed to net buying by individual investors. The actual expense ratio is the total cost borne by investors, including total fees, other expenses, and brokerage commissions. According to ETF CHECK, the actual expense ratio for the ACE US S&P500 ETF is 0.18%, which is lower than the average of 0.31% for similar (passive and currency-exposed) products.

Due to its currency-exposed nature, investors can also benefit from foreign exchange gains if the USD/KRW exchange rate rises. In fact, over the past year, the ACE US S&P500 ETF recorded a return of 16.60%, while the US S&P500 Index rose by only 12.74%. Over the past three years, the ACE US S&P500 ETF rose by 62.98%, whereas the S&P500 Index increased by 46.29%.

Nam Yongsoo, Head of ETF Management at Korea Investment Management, stated, "The ACE US S&P500 ETF is a product characterized by stable management and a low actual expense ratio," and introduced it as "an ideal product for long-term, regular investment in pension accounts."

He added, "The ACE US S&P500 ETF not only has a portfolio focused on leading US blue-chip stocks, but also undergoes quarterly regular rebalancing (asset reallocation), allowing investors to conveniently invest in the US stock market."

The ACE US S&P500 ETF is a performance-based product, and past performance does not guarantee future results. In addition, there is a risk of principal loss depending on management outcomes, so investors should exercise caution.