Korea Investment Trust Management said Tuesday that cumulative retail investor net purchases into its ACE KRX Gold Spot ETF have exceeded 200 billion won ($145 million) since the start of the year.
According to Korea Exchange, retail net purchases into the ACE KRX Gold Spot ETF totaled 211.6 billion won from the start of the year through Monday. In August alone, more than 65.5 billion won in retail funds flowed into the product, which has recorded net retail buying on every trading day of the month. Over the past year, cumulative retail net purchases have reached 1.04 trillion won.
Annual inflows have also climbed sharply. A total of 693.5 billion won has poured into the ACE KRX Gold Spot ETF from the start of the year through Monday, making it the top performer for inflows among all 28 domestic raw-materials ETFs listed in South Korea.
The strong inflows reflect growing demand for gold as an alternative asset to hedge against market volatility. A preference for safe-haven assets driven by geopolitical risk, combined with a weakening outlook for interest rate hikes, has pushed gold prices higher.
The KRX gold price rose 11.3 percent per gram from the first trading day of August through Monday, while the ACE KRX Gold Spot ETF gained 12.76 percent over the same period. Returns over the past one year, three years and since listing stand at 38.07 percent, 147.72 percent and 191.45 percent, respectively.
Korea Investment Trust Management launched the ACE KRX Gold Spot ETF in December 2021. It tracks the KRX Gold Spot Index, calculated and published by Korea Exchange. As of Monday, its net assets stood at 4.27 trillion won, the largest among domestic raw-materials ETFs.
"As volatility in equity assets has increased recently, more retail investors are looking to add gold spot ETFs to their portfolios," said Nam Yong-su, head of the ETF division at Korea Investment Trust Management. "Unlike exchange-traded futures products, gold spot ETFs do not incur rollover costs from monthly contract rollovers, which makes them more cost-efficient for long-term holders."
Another Korea Investment Trust Management product, the ACE High-Dividend Plus Covered Call Active ETF, has also seen strong retail buying since its listing. The company said Thursday that cumulative retail net purchases in the fund had surpassed 100 billion won — a milestone reached roughly two months after its June listing. Net assets were tallied at 124.9 billion won. The ACE High-Dividend Plus Covered Call Active ETF holds domestic high-dividend stocks including Samsung Electronics and SK hynix, and pays monthly distributions by selling KOSPI 200 call options and collecting the resulting option premium.
th5@heraldcorp.com
