KB Asset Management's 'KBSTAR Money Market Active ETF' Surpasses 100 Billion KRW in Net Individual Purchases

Amid uncertainty over the timing of interest rate cuts, investors continue to flock to short-term bonds and parking-type products that offer relatively stable returns. Among these, KB Asset Management's parking-type exchange-traded fund (ETF) is seeing a noticeable inflow of funds.

KB Asset Management announced on the 3rd that its ultra-short-term product, the ‘KBSTAR Money Market Active ETF,’ has surpassed 100 billion KRW in cumulative net purchases by individual investors since the beginning of the year. Notably, 44 billion KRW flowed in over the past month alone.

Parking-type ETFs serve both as investment waiting funds and products seeking short-term returns, effectively playing the same role as parking accounts. While bank time deposits require fulfilling a fixed term to receive full interest, parking-type ETFs can generate annual returns of around 3-4% even with just one day of investment.

The ‘KBSTAR Money Market Active ETF’ invests in ultra-short-term bonds maturing within three months and employs an active excess return pursuit strategy, delivering relatively superior performance even within the same category.

The portfolio’s weighted average remaining maturity is managed between 40 to 80 days depending on market conditions. It is characterized by pursuing excess returns through additional asset purchases via repurchase agreement (RP) sales when necessary. Additionally, it offers high liquidity and the advantage of allowing investors to redeem funds anytime without being bound by a fixed term.

The main driver of fund inflows is its outstanding performance. The ‘KBSTAR Money Market Active ETF’ recorded a 1-year return of 4.36% and a year-to-date return of 1.73%, ranking first among 16 parking-type ETFs listed on the domestic stock market.

Based on these returns, the ‘KBSTAR Money Market Active ETF’ has grown its net asset size to approximately 1.8 trillion KRW within one year of its launch.

Kim Chan-young, Head of the ETF Business Division at KB Asset Management, said, “In times of significant market uncertainty, it is advantageous to invest in products like parking-type ETFs to generate returns. From an investor’s perspective, it is important to carefully compare returns even for short-term funds.”

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