Fund targets policy-backed sectors including AI, biotech, defense and energy; converts to bond portfolio upon reaching 6% return target
By Jung Yoon-hee, The Herald Business
KB Asset Management on Monday announced the launch of the KB K-Growth and Governance50 Target-Conversion Fund No. 4, which invests in companies expected to benefit from the government's key industrial support policies and in stocks with strong corporate value improvement potential.
The product follows the KB K-Growth and Governance50 Target-Conversion Funds No. 1, 2 and 3, all of which achieved their target returns ahead of schedule.
Fund No. 4 is a bond-mixed fund that selectively invests in sectors the government is actively promoting under its "ABCDEF" framework — AI, Bio, Contents, Defense, Energy and Factory (manufacturing) — as well as in stocks expected to rise in value through improved corporate governance and expanded shareholder returns.
The fund allocates roughly 50 percent of its portfolio to key companies in policy-backed industries to pursue growth, while the remaining 50 percent goes into short-term bond ETFs and money market funds for stable returns.
The target return is 6 percent. Once the cumulative operating return for Class A units reaches 6 percent — equivalent to a cumulative net asset value of 1,060 won — the fund will sell all equity-related assets and convert to a domestic bond-focused portfolio to preserve the gains.
Beom Gwang-jin, head of KB Asset Management's Pension WM division, said the target-conversion fund "pursues profit opportunities while securing stability by switching to a bond-type structure after the target is met." He added that the fund selectively invests in growth industries and corporate value improvement stocks based on the proven strategy from Funds No. 1, 2 and 3, making it "a particularly effective investment vehicle in a highly volatile market environment like the current one."
The fund will be available through Shinhan Bank, Daeshin Securities and iM Securities. Subscriptions close June 22, with the fund set to launch the same day.
KB Asset Management earlier launched the KB Samsung Electronics SK Hynix50 Fund, which concentrates investments in Samsung Electronics and SK Hynix while using short-term government and monetary stabilization bonds for stability. The company introduced the fund with the same investment strategy after its RISE Samsung Electronics SK Hynix Bond Mixed 50 ETF surpassed 3 trillion won (approximately $1.97 billion) in net assets within three months of listing.
yuni@heraldcorp.com
