Korea Investment Management Launches 'Korea Investment SoBuJang Korea Mixed Asset Fund'

[Asia Economy Reporter Eunmo Koo] Korea Investment Trust Management announced on the 15th that it will launch the "Korea Investment SoBuJang Korea Mixed Asset Investment Trust (Private Investment Fund of Funds)" (hereinafter Korea Investment SoBuJang Korea Mixed Asset Fund), which focuses on investing in companies related to materials, parts, and equipment.

The Korea Investment SoBuJang Korea Mixed Asset Fund is a private investment fund of funds that diversifies investments into eight private funds managed by professional private fund managers. It has a closed-end structure that does not allow early redemption for four years after establishment. The professional private fund managers include six firms: DS Asset Management, Value System Asset Management, Anda Asset Management, GVA Asset Management, KTB Asset Management, and Korea Investment Value Asset Management.

The private funds invested in by the Korea Investment SoBuJang Korea Mixed Asset Fund allocate more than 50% of their investments to stocks and convertible bonds (CB), bonds with warrants (BW), and redeemable convertible preferred stocks (RCPS) of companies related to materials, parts, and equipment, and more than 30% to mid-sized and small enterprises. Korea Investment Trust Management, together with Korea Growth Investment Corporation, selects private fund managers and monitors performance and risks quarterly to review the appropriateness of management by checking investment asset evaluation methods and fund recovery status.

The individual private funds invested in by the Korea Investment SoBuJang Korea Mixed Asset Fund have Korea Growth Investment Corporation and the professional private fund managers as mezzanine and subordinate investors, respectively, who bear loss risks first. Losses up to 32.4% are borne first by Korea Growth Investment Corporation and the professional private fund managers as mezzanine and subordinate investors, and only losses exceeding this are borne by senior investors. This structure partially protects investors from losses.

Jae-young Seo, Deputy Head of the Multi-Asset Management Team at Korea Investment Trust Management, said, "Recently, the government announced the 2020 economic policy direction, showing a strong commitment to fostering the SoBuJang industry. Interest in fostering the SoBuJang industry is expected not to be a short-term theme but to become a mega trend for the next 10 to 20 years, presenting an attractive investment opportunity."

The Korea Investment SoBuJang Korea Mixed Asset Fund charges a front-end sales fee of 1% and an annual total fee of 1.09% for Class A. Class C has no front-end sales fee and an annual total fee of 1.34%. The total fundraising amount is approximately 25 billion KRW, and subscriptions are available on a first-come, first-served basis at Korea Investment & Securities starting today.

This content was produced with the assistance of AI translation services.