By Yoon Ja-young
Staff Reporter
Korea Exchange (KRX), the country's stock market operator, plans to launch a 200 billion won fund investing in the Kosdaq jointly with asset management companies. The measure is expected to boost the junior, tech-heavy stock market, which has been faltering amid the global financial market crunch.
``We had talks about the fund with the executives of five asset management firms last week,'' said Hwang Sung-yoon, an executive in charge of Kosdaq at the KRX.
``It could be a 50 to 50 investment with the KRX funding 100 billion won and the asset management firms funding another 100 billion won,'' Hwang said, adding that a concrete plan for the fund hasn't been decided on yet.
KRX CEO Lee Jung-hwan also said last month that it is planning a Kosdaq fund as a new growth engine for the market.
The fund is in line with the KRX's plan to categorize the junior market into prime, vision and general markets. The prime market would include blue-chip companies, while the vision market would be comprised of firms with strong growth potential.
``The launch of the fund will be linked with the categorization of the market. There will be prime and vision indices following categorization. They could be the benchmark indices for the fund,'' Hwang said.
He explained that the lack of an influential benchmark index is currently the biggest problem in the junior market. The fund could invest, for example, around 60 to 70 percent in the prime market and 30 percent in the vision market, according to Hwang. He added that it plans to launch the fund in the first half of this year.
The government's designation of the stock market operator as a public institution, however, is hampering the plan, according to KRX.
``We will be subject to government control in terms of budget and human resources. KRX's funding for the Kosdaq fund would also be affected by the designation,'' Hwang said.