US S&P500&GOLD ETF to Be Listed on the 9th: "Added Gold, Lowered Fees"

Kiwoom Asset Management announced on December 8 that the 'KIWOOM US S&P500&GOLD ETF' will be newly listed on the Korea Exchange on December 9.

The ETF invests with a fixed allocation of 90% in the S&P500 and 10% in gold (spot). It combines the long-term high growth potential of the S&P500 with the strong downside protection that gold has demonstrated during periods of market stress. The product is designed to reduce volatility and enhance risk-adjusted returns compared to a pure S&P500 investment, thereby aiming for more stable returns.

In fact, during the dot-com bubble burst in 2000 and the global financial crisis in 2008, the S&P500 fell by -42% and -44%, respectively, while gold rose by 22% and 16%. This demonstrates that gold has served as an effective buffer during prolonged downturns.

Gold tends to show structural upward trends during periods of dollar weakness and also helps offset currency risk associated with the S&P500, which is a dollar-based asset. The recent trend of major central banks continuously increasing the proportion of gold in their foreign reserves is also seen as strengthening the strategic value of gold.

The total expense ratio is 0.01% per year. One of the key advantages is that investors can gain simultaneous exposure to both the S&P500 (90%) and gold (10%) at a very low cost. The 9-to-1 allocation has a daily return correlation coefficient of 0.99 with the S&P500 index, which means investors can maintain the upward trend of the S&P500 while reducing losses during downturns, thereby improving long-term compound returns. This approach is more cost-efficient than constructing a portfolio with the same allocation by separately purchasing an S&P500 ETF and a gold ETF. Additionally, there are no tax issues arising from rebalancing to maintain the allocation, allowing for stable asset allocation benefits.

Lee Kyungjoon, Head of ETF Management at Kiwoom Asset Management, introduced the 'KIWOOM US S&P500&GOLD ETF' as a strategic core product that maintains the advantages of traditional S&P500 investment while strengthening protection against market volatility. He added, "With an ultra-low expense ratio of 0.01%, we expect this ETF to become a new flagship product that long-term investors can utilize without burden."

He emphasized, "The 10% gold allocation is considered the optimal level for mitigating long-term risk and enhancing compound efficiency, as suggested by numerous asset allocation studies, including Ray Dalio's 'All Weather' portfolio."

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