'KOSPI bull run' not over... pension retail investors 'going all-in on Samsung Electronics and Hynix'

Pension retail investors pile into semiconductor and KOSDAQ ETFs

Semiconductor- and KOSDAQ-related exchange-traded funds (ETFs) were the most bought last month in retirement pension accounts at major brokerages, data showed. The buying suggests many investors expect demand for artificial intelligence (AI) and server semiconductors to rise further despite various external uncertainties.

According to Mirae Asset Securities on the 7th, two of the top five net-bought ETFs in the firm's retirement pension accounts last month tracked the semiconductor value chain, while two were KOSDAQ index ETFs. The brokerage has the highest market share across the entire financial industry in the defined-contribution (DC) retirement pension market as of the end of last year.

The most net-bought ETF was "TIGER Semiconductor TOP10." The ETF invests in 10 key names in South Korea's semiconductor value chain, including SK Hynix (28.07%), Samsung Electronics (23.95%), Hanmi Semiconductor (17.49%) and Lino Industrial (7.96%).

Second in net buying was "KODEX Samsung Electronics Bond Mixed." The product allocates roughly 3-to-7 between Samsung Electronics shares and South Korean government bonds. Demand appears to reflect investors' efforts to raise exposure to large-cap semiconductor stocks in pension accounts by using bond-mixed ETFs. Under current rules, DC and individual retirement pension (IRP) accounts can hold risk assets, including stocks, only up to 70% of total assets. The remaining 30% must be filled with safe assets such as savings products and bonds. Because bond-mixed ETFs are classified as safe assets, they allow investors to lift equity exposure beyond 70% within the rules.

"TIGER KOSDAQ" and "KODEX KOSDAQ150," which track the KOSDAQ150 Index, followed. "TIGER 200," which tracks the KOSPI 200 Index, ranked fifth in net buying.

By contrast, funds flowed out of US long-term Treasury-related ETFs. The biggest net-sold ETF in retirement pension accounts was "TIGER US 30-Year Treasury STRIPS Active (Synthetic H)." Investors appear to have rotated into domestic equity ETFs after weak performance, including a three-month return of -4.58% as of the day. "TIGER US 30-Year Treasury Covered Call Active (H)" also saw a decline in net inflows.

By Han-gyeol Seon