Samsung Asset Management said Tuesday it is listing the KODEX Korea TDF2065 Active Qualified ETF, a target-date fund that invests exclusively in domestic stocks and bonds and automatically adjusts asset allocation across an investor's life cycle.
The product is the first domestic qualified TDF ETF to launch since financial regulators revised related implementation rules in April to support the stable management of target-date funds — a key retirement savings vehicle. The revision extended "qualified TDF" status to funds composed entirely of domestic assets. Under the qualified designation, investors can allocate up to 100 percent of their defined-contribution and individual retirement pension accounts to the fund, free from the standard 70 percent cap on risky assets.
The ETF's core strategy combines a life-cycle asset allocation approach — known as a glide path — with an active management overlay designed to outperform the market.
With a target retirement year of 2065, the fund currently holds domestic equities at roughly 80 percent of the portfolio to pursue long-term compounding returns during investors' younger years. As the retirement date approaches, the fund automatically shifts toward safer assets such as bonds.
By 2065, safe assets will account for 64 percent of the portfolio. After retirement, that share rises to as much as 80 percent, transitioning the fund naturally toward capital preservation.
The equity portfolio is split between a core allocation — roughly 50 percent in broad market exposure through the Kospi and KOSPI 200 — and a satellite allocation of about 50 percent targeting leading sectors of the Korean market, including semiconductors, AI power infrastructure, secondary batteries, defense and shipbuilding.
When core assets outperform satellite holdings, the fund shifts a portion of the satellite allocation back to core to manage tracking error. The fund also employs a "smart trend strategy" that tactically adjusts equity and bond weightings based on market conditions and manages bond duration in line with the economic cycle — all aimed at generating consistent excess returns against its benchmark, the FnGuide Korea TDF 2065 index.
Investing entirely in domestic assets eliminates currency risk and is designed to defend against the erosion of the won's real purchasing power from inflation. Investors holding the ETF in a general brokerage account also benefit from the capital gains tax exemption on domestic equity trading, giving it a tax advantage over ETFs that hold overseas assets.
"We are offering a new tailored option — 100 percent domestic assets — in a TDF market that has been centered on global asset allocation," said Hwang Hee-young, a fund manager at Samsung Asset Management. "We will develop this into a flagship pension product that grows alongside Korea's capital markets."
As volatility in the domestic stock market has increased, demand for stable returns has grown. Cumulative net purchases by retail investors in the KODEX Money Market Active ETF — a cash-parking product designed for short-term stable management — have surpassed 1.3 trillion won ($942 million). The fund is structured around a money market fund approach that invests in highly rated liquid assets such as ultra-short-term bonds and commercial paper. It has also drawn attention as an option for managing idle cash within pension portfolios, as it can be held at up to 100 percent in individual pension and retirement accounts.
jiyun@heraldcorp.com
