The domestic stock market is showing the strongest performance among global equity markets, buoyed by expectations of economic stimulus following the launch of the new government and hopes that the revision of the Commercial Act will help resolve the Korea Discount (the undervaluation of the Korean stock market). As a result, investor interest in equity funds is growing.
According to the financial investment industry on July 11, a total of 3.725 trillion won has flowed into domestic equity funds since the beginning of the year.
In particular, value funds that invest in undervalued stocks are attracting attention. The VIP Korea Value Investment Fund is the flagship fund of VIP Asset Management, a leading value investment house in Korea, and employs a bottom-up investment strategy focused on undervalued stocks. Since its launch in April 2023, the fund has grown to 880 billion won in assets under management (AUM) within two years, successfully attracting inflows based on its solid performance.
The VIP Korea Value Investment Fund aims to accompany investee companies over the long term rather than seeking short-term gains, investing in undervalued blue-chip stocks in Korea. Four fund managers, who have worked together for over 10 years, operate the fund through a multi-manager system that leverages their respective areas of expertise in a complementary manner. Rather than simply buying and holding value stocks, the fund pursues a friendly activist strategy by actively voicing opinions to resolve undervaluation after purchasing stocks. The goal is to establish strategies that enhance corporate value for the benefit of all shareholders and to help companies return value to shareholders.
Another unique feature is that this is a performance-linked fund, where management fees vary depending on fund performance. The management fee rate for the next quarter changes according to the fund's return over the previous year; if the return for the previous year is negative, the management fee is reduced to 0%. Conversely, if the fund exceeds its absolute return target, the management fee increases.
As of July 7, the fund recorded a six-month return of 30.81% (A class), outperforming its benchmark, the KOSPI200, which posted a return of 24.50% over the same period.
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