KODEX Version of 'China Electric Vehicle ETF' Released... Mirae Asset's 'Rival'

Specialized ETF in Electric Vehicle Secondary Battery Sector
Total Fees Cheaper Than Mirae Asset

[Asia Economy Reporter Hwang Junho] Samsung Asset Management, the No. 1 asset management company in Korea, is launching its first exchange-traded fund (ETF) targeting the Chinese electric vehicle market. This move is aimed at competing with Mirae Asset Global Investments’ ‘TIGER China Electric Vehicle SOLACTIVE ETF,’ which has become a star ETF with net assets of 3.421 trillion KRW (as of February 28).

According to Samsung Asset Management on the 15th, the ‘KODEX China Secondary Battery MSCI’ ETF, launching on the 22nd, uses the MSCI China All Shares IMI Select Batteries as its underlying index. It invests in the top 20 companies involved in electric vehicle battery materials and equipment, excluding completed vehicle manufacturers. While Mirae Asset’s investment scope ranges broadly from automakers to chemical companies, Samsung’s product is characterized by its specialization in secondary batteries within the electric vehicle sector.

The total fees, including management fees, are set lower than Mirae Asset’s. Mirae Asset charges 0.49%, whereas this product is about 0.25%. For long-term investors or those investing through pension accounts, if the investment returns of the two products are similar, the total fees could be a deciding factor.

This product is designed to target the market initially created by Mirae Asset, signaling a major strategic shift in ETF offerings, including the active launch of thematic ETFs. Samsung also plans to launch the KODEX U.S. Clean Energy Nasdaq ETF on the same day. The generational change, marked by former Samsung ETF market pioneer Bae Jae-gyu moving to become CEO of Korea Investment Trust Management, also supports this strategic shift.

Samsung has dominated the market since introducing Korea’s first ETF under the ‘KODEX’ brand in 2002. However, despite the ETF market growing from 52 trillion KRW at the beginning of last year to 73 trillion KRW within a year, driven by the popularity of thematic ETFs, Samsung failed to respond adequately, causing its market share to drop to 42%. As of the 14th, the market share gap with Mirae Asset has narrowed to 5.84 percentage points.

However, the declining returns of Chinese electric vehicle ETFs pose a challenge. The TIGER China Electric Vehicle ETF recorded a 51.47% return over one year as of the end of last year but has posted -18.92% from the beginning of this year to date. Both products invest in stocks and derivatives related to the sector, carry a high risk rating of ‘Level 2,’ and do not hedge currency risk, which could be a burden given the current international situation.

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