Yuanta Securities Launches 'We Know Public Offering Fund Lab No. 2' for Quality IPO Fund Investments

[Asia Economy Reporter Lee Seon-ae] Yuanta Securities announced on the 10th that, as the schedule for large-scale initial public offering (IPO) stocks continues, it will offer the ‘We Know IPO Fund Wrap No. 2,’ which is managed by constructing a portfolio with high-quality IPO funds to provide discretionary investment services that respond to IPO demand.

Yuanta Securities, which has proactively responded to the IPO market by focusing on the consecutive listings of blockbuster IPOs in 2020 and 2021, sold approximately KRW 1.69 trillion worth of IPO funds from the second half of 2020 through last year. Additionally, based on its know-how in selecting IPO funds and an active rebalancing strategy, it launched the ‘We Know IPO Fund Wrap’ in February last year, achieving an asset size of KRW 60 billion and accumulating successful management experience and records.

In particular, the ‘We Know IPO Fund Wrap’ strategically incorporates funds with IPO preferential allocation benefits and general IPO funds, recognizing that IPO subscriptions by individual investors face high competition rates, limiting actual returns relative to investment amounts. This approach enables effective IPO investment.

The 2022 IPO market is also expected to feature multiple large-scale IPOs, including LG Energy Solution, considered a mega IPO, along with Hyundai Engineering, SSG.com, Kurly, and Kakao Entertainment. The representative IPO investment fund, the IPO High Yield Fund, has preferential allocation benefits of 5% for KOSPI and KOSDAQ IPOs, and the KOSDAQ Venture Fund has a 30% preferential allocation for KOSDAQ IPOs. Therefore, the performance of IPO funds investing in high-growth IPO companies is expected to remain favorable this year.

The newly launched ‘We Know IPO Fund Wrap No. 2’ operates with an event-driven strategy that buys suitable funds timely based on each fund’s IPO participation schedule and research on included stocks, and redeems them upon achieving profits. It selects advantageous funds according to the type of IPO, adjusts weights, and pursues excess returns and yield protection through active responses aligned with market conditions. For example, if market risks expand, it increases the proportion of general IPO funds with high investment ratios in government and high-quality bonds to defend yields.

Kim Joo-hyung, head of the Wrap Management Team at Yuanta Securities, said, “Since this year is expected to be an even bigger IPO market than last year, this product will be a good alternative for investors interested in IPO investments,” adding, “Especially with many high-growth large companies scheduled for IPOs from the first half of the year, it is advantageous to join IPO investment products as soon as possible.”

The minimum subscription amount is KRW 10 million. Fees for Type A are charged annually in advance at 1.2%, plus a performance fee agreed upon with the client, while Type B charges 1.5% annually in arrears. Subscriptions are available through Yuanta Securities’ nationwide branches and mobile non-face-to-face services.

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