ACE KRX Gold Spot ETF Surpasses 1.5 Trillion Won in Net Assets

Korea Investment Management announced on September 10 that the net asset value of the ACE KRX Gold Spot Exchange Traded Fund (ETF) has surpassed 1.5 trillion won.

The ACE KRX Gold Spot ETF, launched by Korea Investment Management in December 2021, is the first gold spot ETF introduced in Korea. According to the Korea Exchange, as of September 9, the net asset value of the ACE KRX Gold Spot ETF stood at 1.6053 trillion won. At the end of last year, the ETF's net asset value was 622.8 billion won, meaning its size has increased by 157.75% so far this year.

There has also been a steady inflow of funds from individual investors. Since the beginning of this year, individual investors have made a net purchase of 393.9 billion won in the ACE KRX Gold Spot ETF. According to ETF CHECK, the total capital inflow into this ETF this year has reached 692.5 billion won.

The stable performance since its listing has contributed to the inflow of funds. The ACE KRX Gold Spot ETF recorded a one-year return of 52.06%, ranking second among domestic commodity ETFs, following the ACE Gold Futures Leverage (Synthetic H) ETF, which posted a return of 82.94%. The three-year and since-inception returns were recorded at 114.44% and 135.36%, respectively.

The recent reduction in fees has also increased the ETF's appeal. In July, Korea Investment Management lowered the annual total expense ratio of the ACE KRX Gold Spot ETF from 0.5% to 0.19%. Many investors are allocating assets to the ACE KRX Gold Spot ETF within their pension and general accounts. The fee was reduced to enhance long-term investment returns. Due to the nature of the product, which invests in physical gold, the ACE KRX Gold Spot ETF can be included up to 70% in defined contribution (DC) retirement pensions and individual retirement pensions (IRP).

Nam Yongsoo, Head of ETF Management at Korea Investment Management, stated, "The ACE KRX Gold Spot ETF is a product that Korea Investment Management has managed stably for about four years since introducing it as Korea's first gold spot ETF in 2021," and added, "Since gold is an asset with a low correlation to stocks, we recommend including it in your portfolio as part of asset allocation."

As a performance-based product, past performance does not guarantee future results. In addition, principal loss may occur depending on investment outcomes.