NH-Amundi Asset Management Achieves Target Return Early with "Growth Korea Target Maturity Fund"

NH-Amundi Asset Management announced on January 15 that the "Growth Korea Target Maturity Fund" achieved its target return of 7% on January 12.

The Growth Korea Target Maturity Fund is a product that selects key industries driving Korea's growth, investing less than 50% of its assets in equities and allocating more than 50% to domestic bonds. The rally in major semiconductor stocks such as Samsung Electronics and SK Hynix, along with the sharp rise in the KOSPI index, served as the main drivers for achieving the target in a short period of time.

Launched on November 28 of last year, the fund reached its 7% target return in just 45 days. After achieving the target, the fund reallocated its equity holdings and now maintains a 100% allocation to bonds, thereby securing and stabilizing its gains. The converted fund will preserve returns through investments in high-quality bonds until its maturity on November 27, at which point it will be redeemed.

A target maturity fund is a product that invests in risk assets such as equities and, upon reaching a predetermined return, shifts to safe assets such as bonds for management until maturity.

After achieving the target, the fund is automatically converted to safe assets, which limits the risk of losses due to market volatility. However, until the target is reached, losses may occur depending on market conditions, just like any other fund. It should also be noted that after conversion, investors cannot benefit from any additional gains even if the main investment assets continue to rise.

If you wish to maximize expected returns rather than prioritize the stability of a target maturity fund using the same investment strategy, the "Growth-Driven Korea Fund" could be an alternative. The Growth-Driven Korea Fund shares the same investment strategy as the target maturity fund but does not have a specified target return, allowing investors to capture the full market return.

Launched on October 14 of last year, the Growth-Driven Korea Fund has posted a 33.87% return (A-e class basis) as of January 13, driven by the stock price increases of domestic companies in AI semiconductors and infrastructure, defense, shipbuilding, and nuclear power sectors since its inception.

Shin Yongin, Executive Vice President and Head of Marketing at NH-Amundi Asset Management, said, "Thanks to the strong performance of domestic leading stocks such as AI semiconductors, the target maturity fund was able to reach its goal much more quickly than expected. For investors looking to invest in the growth potential of Korea's key growth-driving companies, the Growth-Driven Korea Fund could be a viable alternative."