Last Year, Fund Net Assets Reached 832 Trillion Won... Increased by Over 100 Trillion Won Compared to Previous Year

Indirect Investment Boom Amid Increased Volatility of COVID-19

[Asia Economy Reporter Minji Lee] The Korea Financial Investment Association announced on the 13th that the net assets of funds reached 813.9 trillion KRW last year, an increase of more than 117 trillion KRW compared to the previous year. Except for derivative types, all categories saw inflows, resulting in a net inflow of 66.1 trillion KRW into the overall fund market this year.

The net assets of public funds recorded 312.1 trillion KRW, up 37.4 trillion KRW (13.6%) from the end of last year, while private funds recorded 519.8 trillion KRW, an increase of 74.3 trillion KRW (16.7%). Among public funds, mixed asset*104.1%) and mixed bond types (42.5%) showed notable increases, while in private funds, mixed bond types (56.8%) and short-term financial funds (35.7%) saw significant net asset growth.

The net assets of overseas investment funds reached 287.7 trillion KRW, an increase of 50.9 trillion KRW compared to the end of last year. The overseas stock investment boom spread to funds, showing a higher growth rate compared to domestic investment funds.

By fund type, the total net assets of equity funds recorded 110.8 trillion KRW, up 20.1 trillion KRW (22.1%) from the end of last year. Domestic equity funds reached 71 trillion KRW, increasing by about 12.7%. Due to the sharp rise in the stock market early in the year, net assets increased in the first half, but slightly decreased in the second half due to volatility. Overseas equity funds continuously attracted capital, growing by about 43.6% to 39.8 trillion KRW.

The net assets of bond funds recorded 129.8 trillion KRW, up 11.9 trillion KRW (10.1%) from the end of last year. Strong growth was seen in the first half due to institutional and corporate capital deployment, but growth slowed in the second half due to the impact of interest rates above the base rate. The net assets of mixed bond funds totaled 23.8 trillion KRW, showing the highest net asset growth rate (46.8%) compared to the end of last year, driven by a boom in the initial public offering (IPO) market and significant inflows into public offering stock funds.

Short-term financial funds, despite a slight decrease in net assets due to seasonal MMF characteristics and year-end cash demand, closed at 136 trillion KRW, up 9.7 trillion KRW (7.7%) from the end of last year. The total net assets of fund of funds increased by 14.4 trillion KRW (28.5%) from the end of the previous year to 65 trillion KRW. As the retirement pension market grows, a total of 7.7 trillion KRW flowed in mainly into target date funds (TDFs).

Derivative product funds were the only category among all funds to experience a net outflow of capital. Net assets recorded 50.8 trillion KRW, up 8 billion KRW (1.6%) from the end of last year. Although net assets turned to an increase compared to the previous year, the introduction of high-level financial investment product regulations reduced net inflows, resulting in the lowest growth rate.

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