Kiwoom Asset Management has listed South Korea’s first ETF tracking the DAX®, Germany’s blue-chip benchmark.
The exchange-traded fund started trading on the Korean Stock Exchange on December 22 and provides domestic investors direct exposure to Europe’s biggest economy and a means of geographic and industry diversification.
Asian retail and institutional investors have stepped up their purchases of foreign stocks in the past decade, decreasing their home bias and seeking diversification. South Korea’s overseas financial assets climbed to a record in the third quarter of 2021, according to central bank data, driven by increased stock investments1. Equity benchmarks for the South Korean market can have more than 40% exposure to the technology sector.
DAX tracks the performance of the largest companies listed on the Frankfurt Stock Exchange’s Regulated Market that satisfy certain minimum quality and profitability requirements. Constituent selection is based on free-float market capitalization. The index, which recently underwent a methodology overhaul and an enlargement from 30 to 40 components, is well diversified across sectors and includes some of the world’s best-known brands, such as Adidas, BMW, Puma, Porsche and Volkswagen.
“As Qontigo continues to grow the global footprint of the DAX, our collaboration with Kiwoom Asset Management marks an important milestone,” Serkan Batir, Managing Director DAX at Qontigo, said in a press release. “We are thrilled to work with the Kiwoom team on this first initiative and look forward to future collaborations.”
Established in 1988, Kiwoom Asset Management has USD41 billion under management.
1 Yonhap News Agency, ‘S. Korea’s overseas financial assets hit new high in Q3,’ November 28, 2021.
