Mirae Asset K-New Deal ETF Surpasses 400 Billion KRW in Assets Under Management

17.69 Billion KRW Poured into Secondary Battery ETFs Alone... Popularity of 'K-New Deal'

[Asia Economy Reporter Minwoo Lee] The assets under management (AUM) of Mirae Asset Global Investments' K-New Deal index-related exchange-traded fund (ETF) product group have surpassed 400 billion KRW.

Mirae Asset Global Investments announced on the 19th that the AUM of the 'TIGER K-New Deal ETF Series,' which was listed on the 7th, reached 403.4 billion KRW. Specifically, the breakdown is ▲'TIGER KRX BBIG K-New Deal ETF' 154.2 billion KRW ▲'TIGER KRX Secondary Battery K-New Deal ETF' 176.9 billion KRW ▲'TIGER KRX Bio K-New Deal ETF' 24.8 billion KRW ▲'TIGER KRX Internet K-New Deal ETF' 25.1 billion KRW ▲'TIGER KRX Game K-New Deal ETF' 22.4 billion KRW.

The net purchase amount by individuals alone totaled approximately 100 billion KRW across the five ETFs. On the listing day, individuals also net purchased 35.4 billion KRW, setting the record for the largest individual purchase on the listing day in the domestic ETF market.

The 'TIGER K-New Deal ETF Series' is a product that focuses investment on companies in the 'BBIG' sectors such as bio, battery, internet, and gaming. It uses a total of five underlying indices, including the 'KRX BBIG K-New Deal Composite Index' and four industry-specific indices.

The ‘KRX BBIG K-New Deal Index’ is composed of 12 stocks, selecting the top three by market capitalization in each of the battery, bio, internet, and gaming industries, equally weighted. The KRX Secondary Battery, Bio, Internet, and Game K-New Deal indices each consist of 10 stocks, where the top three stocks hold an equal weight of 75%, and the remaining seven stocks are weighted by free-float market capitalization at 25%. Unlike previous methods, this approach increases the weighting of top market capitalization stocks, allowing concentrated investment in leading companies of future growth industries.

To minimize tracking error, the ETFs are managed by fully replicating the underlying indices. The ‘TIGER K-New Deal ETF Series’ is a private New Deal fund and, like general equity ETFs, investment losses may occur.

Using the 'TIGER K-New Deal ETF Series' in pension products allows for a long-term investment approach and offers a low separate taxation rate of 3.3% to 5.5% upon pension receipt. Since 2023, the attractiveness of using these ETFs as pension products has increased due to the 20% capital gains tax imposed on stocks. Additionally, the ETFs are not subject to the major shareholder capital gains tax triggered by holding individual stocks worth 300 million KRW, which has recently been controversial. Due to the nature of ETFs, the 0.25% transaction tax is also exempted.

Choi Kyung-joo, Vice Chairman of Mirae Asset Global Investments, said, "Due to the market paradigm shift after the COVID-19 pandemic, BBIG is highly likely to establish itself as a mega trend," adding, "It is worth considering as a part of a portfolio from a long-term perspective."

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