Korea Investment Management, which slashed KINDEX’s expense ratios to the lowest levels in Korea this September, revealed its aim at leading the ETF market by the improving quality of existing products and launching overseas ETFs.

“As observed globally, the Korean ETF market is projected to reach saturation and be dominated by three to four major players,” said Shim Jae-hwan, head of System Fund Investment Division at Korea Investment Management, when asked about the outlook of the industry. According to Shim, major players must have “a well-rounded line-up of KOSPI indexes, leverage, and inverse ETFs including company-specific ones.” He added that KINDEX was one of the few that fulfilled the above conditions.

Korea Investment Management has so far listed nine products and its net assets totaled 667 billion won as of September. Its main product, the KINDEX 200, which tracks the KOSPI 200, was launched in 2008 and has a net asset value of 492 billion won. It is priced at 25,442.18 won and has a 5.87 percent growth rate for the prior three-month period.

This September, Korea Investment Management lowered its ETF fees to 0.1-0.2 percent, down by almost 50 percent. Shim noted that the slashing of fees was implemented to offer the investors higher profit and that it reflected a global trend. He believed that this came at the right time when investors were becoming increasingly sensitive to management fees with a falling profit rate due to the global economic downturn. 

In addition to improving the quality, Korea Investment Management also sought to enhance the diversity. Earlier this month, Korea Investment Management revealed that it was undergoing listing procedures to launch the China A-Shares ETF. 

“After 10 years of tight competition, the number of ETFs has increased to 130 representing almost every notable basket of securities in Korea. We saw the need to move overseas,” said Shim as he explained why his company sought new opportunities in emerging markets. He emphasized that for KINDEX to take a big leap and emerge as a leader, it would “consistently launch new products in untapped blue oceans.”

Korea Investment Management was established as the first investment trust company by the Korean government in 1974. The company has been positioned as one of the best fund houses in Korea, providing a full range of investment products for institutional and retail investors. It is an industry leader in equity and fixed income investment strategies, with $20 billion of assets under management as of the end of September 2012. 

Korea Investment Management said it regards the ETF market place is the most important platform of fund business in Asia with tremendous growth potentials. The company is committed to bring more benefits to investors with slogans for its “KINDEX ETFs” as follows:

- KINDEX ETFs are the most efficient way to get market exposures.

- KINDEX ETFs are the basic building blocks for your investment portfolios.

- KINDEX ETFs are at cost investment with decades of experience.