"This Is What Set Me Apart"... The ETFs Bought by Top 5% Retirement Pension Performers [Personal Finance Barometer]

ETFs Most Heavily Held by Top 5% Return Investors
KOSPI 200, semiconductor and other Korea-linked ETFs dominate
U.S. index ETFs once accounted for a large share
ETF trading only via securities firm accounts...no investments in "leverage" or

As the KOSPI continues its relentless rally, surpassing the 6,000 level, retirement pension investors are also increasingly focusing on the domestic stock market. Exchange-traded funds (ETFs) linked to domestic indices and leading stocks are now taking the place once occupied by ETFs investing in the U.S. stock market.

On the 25th, after the KOSPI closed above 6,000 for the first time in history, dealers held a commemorative ceremony in the dealing room of Hana Bank in Jung-gu, Seoul. Yonhap News

On the 26th, an analysis The Asia Business Daily commissioned from Mirae Asset Securities on the top ETFs held by retirement pension customers showed that ETFs related to the domestic stock market accounted for the overwhelming majority.

Among defined contribution (DC) retirement pension customers at Mirae Asset Securities, the ETF most widely held by those who had an average balance of at least 50 million won over the past six months and ranked in the top 5% in terms of returns was TIGER 200. This was followed by TIGER Semiconductor TOP10, KODEX 200, KODEX Semiconductor, TIGER Secondary Battery Materials Fn, KODEX Samsung Electronics Bond Mixed, TIGER Semiconductor, ACE KRX Gold Spot, KODEX KOSDAQ 150, and KODEX AI Power Core Facilities, in that order. Except for ACE KRX Gold Spot, all of them are ETFs linked to the domestic stock market.

U.S. blue-chip index ETFs such as Nasdaq 100 and S&P 500, which had long dominated retirement pension accounts, have disappeared from the top 10. ETFs tracking major U.S. indices have traditionally been regarded as must-have holdings for retirement pension investors, who need to invest in a stable manner over the long term.

This shift in the investment preferences of retirement pension investors is due to returns. This year, the KOSPI first broke through the 5,000 level and then went on to surpass 6,000. The KOSPI has risen 44.37% since the beginning of the year. In contrast, over the same period, the Nasdaq Composite Index fell 1.63%, and the S&P 500 rose only 0.65%.

In addition, as the sharp rise in the domestic stock market has been driven by semiconductors, retirement pension investors have heavily bought semiconductor-related ETFs. TIGER Semiconductor TOP10, KODEX Semiconductor, KODEX Samsung Electronics Bond Mixed, and TIGER Semiconductor all ranked among the top holdings. With the ongoing rally this year, Samsung Electronics, the flagship semiconductor stock, has become the so-called "200,000-electronics," and SK Hynix has become the so-called "1 million-nix." As a result, related ETFs are also posting strong returns. Since the beginning of this year, TIGER Semiconductor TOP10 has risen 58.73%, KODEX Semiconductor 56.96%, KODEX Samsung Electronics Bond Mixed 18.01%, and TIGER Semiconductor 57.97%.

As the proportion of ETF investments within retirement pensions continues to grow, there are some points to keep in mind when investing in ETFs through retirement pension accounts. Among financial institutions that manage retirement pensions, such as banks, insurance companies, and securities firms, only securities firms allow real-time ETF trading. At banks, ETF trades for retirement pension subscribers are executed in a trust-based manner, whereas in securities firm retirement pension accounts, subscribers can trade directly.

There are also ETFs that cannot be traded in retirement pension accounts. ETFs that can be invested in through retirement pensions are limited to ETFs listed on the Korean market. ETFs listed overseas cannot be purchased. Therefore, if investors wish to invest in ETFs that track overseas stock indices, they must choose ETFs that are listed on the Korean market but track foreign indices.

Furthermore, investors are not allowed to purchase leveraged ETFs that move twice the daily fluctuation of an index, inverse ETFs that move in the opposite direction of an index, or futures-based ETFs. If retirement pension investors want exposure to gold via ETFs, they have no choice but to select a gold spot ETF.

Subscribers to DC-type retirement pensions can invest at most 70% of their accumulated assets in mixed funds or equity funds whose equity allocation exceeds 50%. Since ETFs are also a type of fund, investors cannot allocate more than 70% of their accumulated assets to an ETF that tracks a specific stock index.