KCGI Asset Management launched the KCGI Global Active EMP Fund (equity fund-of-funds), which invests in a diversified portfolio of global ETFs, on Monday. [Provided by KCGI Asset Management]
KCGI Asset Management launched the KCGI Global Active EMP Fund (equity fund-of-funds), which invests in a diversified portfolio of global ETFs, on Monday. [Provided by KCGI Asset Management]

KCGI Asset Management has unveiled an actively managed EMP (ETF Managed Portfolio) fund that selects global ETFs with high upside potential. The strategy uses a quantitative model to identify assets in uptrends while gradually reducing exposure to those whose momentum has reversed, positioning the fund to navigate volatile markets.

KCGI Asset Management said Monday it launched the KCGI Global Active EMP Fund (equity fund-of-funds). The fund drew more than 10 billion won ($6.82 million) on its first day of establishment, Friday.

The product applies a "dual momentum" strategy derived from a quantitative model, investing across global equity, sector and thematic ETFs. It selects ETFs with confirmed uptrends for inclusion and progressively reduces or liquidates positions in assets whose momentum weakens.

The core of the investment strategy is a two-stage screening process combining absolute and relative momentum. The fund first filters for assets maintaining an uptrend based on recent returns, then allocates equally among the top-performing ETFs over the medium to long term. When similar ETFs are highly correlated, only a representative asset is included to avoid redundant exposure. Fund managers plan to respond to sharp market shifts by adding new investment themes and adjusting the weighting of risk assets.

KCGI Asset Management said it launched the global EMP fund as rising market volatility has made asset-allocation strategies focused on quality assets a more effective investment tool than individual stock picking. According to the company, the global ETF market more than doubled in four years, growing from $9 trillion in 2022 to $20 trillion in the first quarter of 2026.

As South Korea's ETF market expands rapidly, EMP funds that allocate assets across multiple ETFs are drawing attention as an investment alternative. They offer broader diversification than individual stocks and allow flexible portfolio adjustments in response to market conditions, making them well suited for managing volatility.

"The global trend is no longer about holding as many ETFs as possible, but about systematically selecting those with high upside potential and pursuing excess returns," a KCGI Asset Management official said. "We plan to manage the fund with the goal of generating stable excess returns through rule-based ETF selection."

The fund carries currency exposure with no hedging and holds a risk rating of 2 (high risk). Structured as a master-feeder fund, the master fund invests at least 60 percent of its trust assets in ETFs. As an open-ended, additional-subscription fund, it imposes no restrictions on mid-term redemptions and charges no early redemption fees.


hajun825@heraldcorp.com