Woori Asset Management plans to expand its exchange-traded fund (ETF) business environ to bond ETFs and overseas ETFs by making the most of its strengths, said Kim Ki-hyun, managing director of the Fixed Income Investment Division at Woori Asset Management.

Giving an assessment of the Korean ETF market 10 years after its introduction, Kim said Samsung Asset Management now dominates the Korean ETF market with a 56.7 percent market share, trailed by Mirae Asset Global Investments Co., Woori Asset Mana-gement, Kyobo Axa Asset Management, and Hanwha Asset Management, followed by a group of latecomers that have been springing up. Kim said his company has 18 trillion won in combined bond assets, of which roughly 850 billion won is in the ETF market.  

Woori Asset Management has less room for maneuvering in the saturated ETF segment, dominated by Samsung Asset Management, Kim said.  

“We’ll focus on bond ETFs, currency ETFs and fundamental ETFs, our strong points, as well as the active ETFs that will make their debut next year,” Kim said. 

“When it comes to bond ETFs,” he said, “Woori Asset Management has a strong presence in the segment, having listed four bond ETFs, the most for a Korean asset management firm.” 

Among Woori Asset Management’s bond ETF products, which have made a strong showing in the market, is the KOSEF 10-year government bond ETF, which had an annual profit rate of 7.79 percent based on the closing price of Oct. 22 to rank in the top 10 profit earners among the listed ETF products. 

Rather than pursuing quantitative growth, he said his company will develop ETF products to differentiate itself from other asset management firms to get a jumpstart in the market.

In this regard, Kim said, “Woori Asset Management is to soon list the KOSEF 10-year government bond leverage ETF, which would have the investment effect of extending maturity twice to 20 years with twice as much price fluctuations. It is the first time a long-term bond leverage ETF will be listed after the Financial Services Commission gave the green light to such long-term leverage ETF products.” 

Kim said there are four kinds of bond ETFs that depend on maturity °™ six-month, one-year, three-year, and 10-year °™ but the listing of the KOSEF 10-year government bond leverage ETF is designed to provide investors opportunities to invest in the bond segment for a longer period of time. Currently, 20-year and 30-year products are on the market, but they have weak points °™  bigger trading size with lower liquidity. 

The KOSEF 10-year government bond leverage ETF is also designed to maximize the effect of wealth distribution by readjusting the ratio of stocks and bonds in accordance with market changes. 

Woori Asset Management is also attaching priority to the listing of overseas ETFs and active ETFs. The company plans to put on the market the India Futures ETF within this year and the China H ETF next year. 

The company also plans to list an active ETF next year, he said. 

ETF products are attractive due to lower costs since asset management firms list ETF products to attract investors without using marketing companies.

Kim, who obtained a doctorate in economics from Sogang University, has been with Woori Asset Management since October 2005. He also worked at such financial firms as Hanwha Economic Research Institute, Samsung Securities, Samsung Asset Management, and Allianz Asset Management