Hanwha Asset Management Launches Fundraising Drive with Rare Earth ARIRANG ETF

Focused Investment in 20 Global Companies Related to Rare Earths and Strategic Resources

[Asia Economy Reporter Minji Lee] Hanwha Asset Management announced on the 18th that it will continue to launch ETFs that meet investor needs by releasing the ‘Hanwha ARIRANG Global Rare Earth Strategic Resources Companies MV’ Exchange-Traded Fund (ETF).

This ETF was constructed through strategic collaboration with the U.S. index provider MVIS (MV Index Solutions). It is a fund that comprehensively invests in companies related to strategic resources such as rare earth elements, lithium, cobalt, and titanium, which are key raw materials in the global carbon-neutral era. This is the first time such a themed ETF has been listed domestically.

Rare earth elements academically refer to 17 elements essential as core raw materials in cutting-edge and future industries such as electric vehicle drive motors, secondary batteries, wind power turbines, smartphones, displays, and GPS systems. Strategic resources generally refer to metal elements that have high industrial demand but are scarce in reserves and difficult to extract, in contrast to common metals like iron, copper, and aluminum that are mass-produced industrially.

Kim Seong-hoon, Head of the ETF Business Division at Hanwha Asset Management, said, “With the explosive increase expected in the distribution of clean energy, the use of major minerals such as lithium, manganese, and rare earth elements is projected to rise significantly. According to the International Energy Agency (IEA) report, many minerals will be consumed in the transition to clean energy, estimating that mineral demand will be four times higher by 2040 and on average six times higher by 2050.”

Looking at the major constituent stocks, there are Pilbara Minerals from Australia, which owns the world’s largest lithium mine; MP Materials, the only rare earth producer listed on the U.S. market; Zhejiang Huayou Cobalt, a cobalt-specialized company listed on the Shanghai Stock Exchange; and Ganfeng Lithium, China’s largest lithium company.

The cumulative performance of the index tracked by the ‘Hanwha ARIRANG Global Rare Earth Strategic Resources Companies MV ETF’ (MVIS Global Rare Earth/Strategic Metals Index) reached 12.79% over three months and 82.78% over one year as of the end of December last year.

Kim said, “Due to the increased demand driven by the growth of front-end industries related to rare earth and strategic resources, steady benefits are expected for these producing companies. We will continue to collaborate with MVIS to launch themed index ETFs and list ETFs that can invest in new business areas such as aerospace themes, green energy, and digital finance.”

Meanwhile, Hanwha Asset Management also expressed its ambition to continuously launch products that meet investor needs with this ETF release as a milestone. Previously, in September last year, Hanwha Asset Management expanded its existing ETF team into the ETF Business Division and reorganized the structure into an ETF Consulting Team, ETF Management Team, and ETF Product Team. Kim emphasized, “I believe the domestic ETF market can grow to 200 trillion KRW within the next five years. Although we have been passive in launching ‘ARIRANG ETFs’ over the past two years, starting with this ETF launch, we will become an ETF management company that investors can trust and invest in.”

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