"Q3 Fund Net Assets 1,080 Trillion KRW... Up 11 Trillion KRW from Previous Quarter"

"Driving Growth of Bond Funds"

The total net assets of funds in the third quarter increased by more than 11 trillion won compared to the second quarter. Growth was mainly driven by bond-type funds as expectations for a base interest rate cut were priced in early.

According to the Korea Financial Investment Association on the 18th, the total net assets of all funds at the end of the third quarter of 2024 amounted to 1,080.7 trillion won, an increase of 11.1 trillion won (1.0%) compared to the end of the second quarter (1,069.6 trillion won). In terms of fund inflows and outflows, MMFs decreased by 12.7 trillion won. On the other hand, all other types saw a net inflow of 21.9 trillion won.

The total net assets of bond-type funds increased the most compared to the previous quarter, rising by 17.1 trillion won (10.9%). In terms of fund flows, bond-type funds also recorded the largest net inflow among all types, with 14.6 trillion won. A representative from the Korea Financial Investment Association explained, "The expectation for a base interest rate cut, which continued in the first half of the year, spread further in the third quarter," adding, "This is analyzed as a result of the early reflection of expectations for the US base interest rate cut in September and the Bank of Korea’s rate cut on the 11th of this month."

Next, the total net assets of real estate funds, centered on private real estate funds, increased by 2.4 trillion won, showing the second-largest increase among all types. Meanwhile, the total net assets of equity-type funds decreased by 1.8 trillion won (-1.4%) compared to the previous quarter, as the domestic stock market repeatedly fluctuated within a box range recently. However, there was a net inflow of funds into equity-type funds during the third quarter, mainly through overseas equity exchange-traded funds (ETFs), totaling 5.8 trillion won, the second-largest net inflow after bond-type funds.

By investment region, the total net assets of domestic investment funds and overseas investment funds were 706.3 trillion won and 374.4 trillion won, respectively, increasing by 1.8 trillion won (0.3%) and 9.3 trillion won (2.6%) compared to the previous quarter. In terms of regional proportions within the total funds, domestic investment funds accounted for 65.4%, while overseas investment funds accounted for 34.6%. The proportion of overseas investment funds increased compared to the second quarter. Domestic investment funds saw an increase in net assets mainly in bond-type funds (15.8 trillion won), while overseas investment funds increased mainly in equity-type (2.8 trillion won) and fund-of-funds (2.7 trillion won) categories compared to the previous quarter.

By public and private funds, the total net assets of public funds and private funds were 420.9 trillion won and 659.8 trillion won, respectively, increasing by 5 trillion won (1.2%) and 6.2 trillion won (0.9%) compared to the previous quarter. Both public and private funds saw the largest increase in net assets in bond-type funds.

ETFs saw an increase in net assets across all types, growing by 6.9 trillion won (4.5%) compared to the previous quarter. However, excluding ETFs, public funds’ net assets actually decreased by 1.9 trillion won (-0.7%). In terms of fund flows, ETFs attracted a net inflow of 10.4 trillion won, driving the overall net inflow of public funds. Conversely, public funds excluding ETFs experienced net outflows.

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