By Jhoo Dong-chan
The nation's asset management companies are introducing various equity funds that are attracting investors for possible inter-Korean business opportunities as relations between the two Koreas are beginning to thaw.
Expectations are high following the historic April 27 summit where the two leaders decided to resume joint economic projects, including operations at the Gaeseong Industrial Complex.
According to sources, Wednesday, Hi Asset Management recently refinanced its unification fund, the Hi Korea Unification Renaissance Fund. Introduced four years ago, the fund has invested in light-industry engaged in inter-Korean economic cooperation.
“The refinancing will reflect the firm's latest method of analysis to actively invest in inter-Korean shares,” said a Hi Asset Management official.
Hi Asset Management added it had experienced difficulties in managing the fund for years due to strained ties between two Koreas.
While it once considered shutting down, the fund started enjoying a constant stream of inquiries following the historic April 27 summit.
Thanks to its surging popularity, the Hi Korea Unification Renaissance Fund boasted its high return rate of 6.16 percent as of May 29, a stark contrast to other investment funds that are sustaining a loss due to the possible U.S. interest rate hike.
Samsung Asset Management also said it will introduce a new fund to invest company shares that may benefit from inter-Korean economic cooperation. The fund is scheduled to be released next month.
“Successful inter-Korean economic cooperation will help boost the nation's stock market. Many firms are expected to enjoy the eased relationship between two Koreas,” said a Samsung Asset Management.
UBS Hana Asset Management has also recently introduced a new inter-Korean fund, the UBS Hana Greater Korea Fund, a refurbished version of its previous UBS Hana FirstClass Ace Fund.
It said the fund will find and invest in underrated firms that are likely to thrive with the improved inter-Korean relationship.
NH-Amundi Asset Management has also released a similar investment fund.
Even private equity fund operator Lime Asset Management introduced a new fund that focuses on inter-Korean shares.
“Inter-Korean economic cooperation is not a one-off event, but a long-term issue,” said Won Jong-jun, CEO of Lime Asset Management.
“We see a good chance since related companies may generate sales and profits if inter-Korean economic cooperation actually proceeds.”