KCGI Management "Korea Fund Achieved Highest Benchmark Excess Return Last Year"

The KOSPI fell by 9.6% over the past year, resulting in an average return of -7.3% for 254 domestic equity funds with assets under management exceeding 10 billion KRW. Only 29 funds, or 11%, recorded positive returns. The KCGI Korea Fund outperformed its benchmark index by 23.5 percentage points (P).

KCGI Asset Management announced on the 4th that the KCGI Korea Fund achieved a 12.4% return last year. Among 254 domestic equity funds with assets under management over 10 billion KRW, it ranked first in excess returns over the benchmark.

The KCGI Korea Fund employed a combination of top-down and bottom-up approaches in stock selection. It maintained a balanced strategy between growth and value styles. By utilizing a flexible investment approach that does not lean toward any specific style, it enhanced its returns.

At the beginning of last year, the KCGI Korea Fund focused on value and growth stocks, but by the end of the year, it increased its allocation to blended stocks. KCGI Management selected companies with strong fundamentals that demonstrate excellent long-term cash flow generation capabilities. They analyzed listed companies with straightforward business models and high predictability, as well as those with economic moats. Through active company visits, they discovered stocks with significant growth potential.

For risk management, KCGI Management excluded stocks with ▲default risk ▲capital erosion ▲liquidity risk ▲governance risk during the initial stock screening phase from the investment universe. They blocked the inclusion of risky stocks. To reduce concentration risk, they regularly managed the investment weights and risk contributions of individual stocks relative to the benchmark and conducted fundamental reassessments.

A KCGI Asset Management representative stated, "The KCGI Korea Fund has maintained excess returns over the market for seven consecutive years recently," adding, "We will continue a flexible approach that is not confined to a specific style, stock selection based on valuation, and risk management."

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