Samsung Asset Management's KODEX 3 Types of Government Bonds Surpass 1 Trillion KRW in Net Assets

Samsung Asset Management announced on the 30th that the net assets of three government bond exchange-traded funds (ETFs) ? 'KODEX Gukgoche 3-year', 'KODEX Gukgoche 10-year Active', and 'KODEX Gukgoche 30-year Active' ? have surpassed 1 trillion KRW, reaching 1.0672 trillion KRW.

These three ETFs invest respectively in 3-year, 10-year, and 30-year government bonds. Since they invest only in risk-free government bonds guaranteed by the Republic of Korea government for principal and interest, investors can access the safest domestic assets.

The KODEX Gukgoche 3 ETFs surpassed 1 trillion KRW in net assets due to growing expectations of interest rate cuts domestically following the recent trend in the U.S. The net assets increased rapidly mainly in 'KODEX Gukgoche 10-year Active' and 'KODEX Gukgoche 30-year Active', which hold longer maturity government bonds of 10 and 30 years.

Since July, the net assets of KODEX Gukgoche 30-year Active and KODEX Gukgoche 10-year Active increased by 148.3 billion KRW and 52.7 billion KRW respectively, raising the total net assets of the three KODEX Gukgoche ETFs from 852.8 billion KRW to 1.0672 trillion KRW.

This accounts for about 40% of the total net assets of 2.7 trillion KRW in government bond ETFs excluding maturity-matching types. The net assets of the three KODEX Gukgoche ETFs are 378 billion KRW for KODEX Gukgoche 3-year, 238.4 billion KRW for KODEX Gukgoche 10-year Active, and 450.7 billion KRW for KODEX Gukgoche 30-year Active, with KODEX Gukgoche 30-year Active being the largest government bond ETF listed domestically.

Capital inflows into government bond ETFs, especially long-term bonds, are expected to continue for the time being. Recently, strong demand for government bonds from both domestic investors and foreigners has pushed market interest rates on 3-year and 30-year government bonds down to 2.978% and 2.942%, respectively, falling below 3% for the first time in about two years. This has strongly fueled expectations of interest rate cuts in the bond market.

All three KODEX Gukgoche ETFs are physical ETFs and can be invested in 100% through DC/IRP and pension savings accounts, making them attractive investment options for pension investors seeking stable investments.

Im Taehyuk, Executive Director at Samsung Asset Management, said, "As expectations grow that the long-standing high interest rate environment will shift toward rate cuts, demand has increased not only from investors pursuing stable asset allocation strategies but also from active investors seeking capital gains. 'KODEX Gukgoche 10-year Active' stands out as a pension ETF with the industry's lowest fees, allowing individuals to invest through retirement pension and pension savings accounts, while institutions benefit from low-cost bond investments."

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