Even with a 20% Loss, Principal Is Guaranteed... National Participation Growth Fund Goes on Sale on the 22nd

The People Participation National Growth Fund will be launched at a scale of 600 billion won. It is a public offering fund that allows investors to take part in building the fund of funds for the National Growth Fund, so they can benefit from its long-term performance.
The fund manager will invest 60% of the assets in advanced strategic industries, the main target sector. Of that amount, at least 10% each will go to unlisted companies and technology-special listing firms on KOSDAQ. The fund will be managed in line with the policy goal of expanding future growth engines, while the remaining 40% will be left to the manager's discretion to improve returns.
The Financial Services Commission (FSC) said on the 6th that the National Participation Growth Fund will be sold on a first-come, first-served basis starting on the 22nd at 10 banks and 15 securities firms. The public subscription target is 600 billion won, and the FSC plans to expand it to a total of 3 trillion won over five years, depending on performance such as returns.
Given that the public is participating in the development of future growth industries, the government will join the sub-funds as a junior investor through fiscal funding, with each sub-fund absorbing losses first up to 20%. The sub-fund managers will also participate as junior investors, creating a structure in which they bear responsibility if losses occur. The benchmark return for sub-fund managers is a cumulative 30% over five years. If returns exceed that level, they will receive incentives. If losses occur, the managers will also share them, a structure designed to maximize the fund's overall returns.
Korea Growth Investment Corporation (K-Growth) was selected as the manager of the fiscal fund of funds. Mirae Asset Global Investments Co., Ltd., Samsung Asset Management, and KB Asset Management were chosen to manage the public offering fund that handles fundraising. For the sub-fund managers, DS Asset Management Co., Ltd. and Mirae Asset Global Investments Co., Ltd. were selected for the large category, worth 120 billion won. Life Asset Management, Midas International Asset Management Ltd., Timefolio Asset Management, and Korea Investment Value Asset Management were selected for the medium category, worth 80 billion won. The small category, worth 40 billion won, was assigned to The J Asset Management, SUSUNG ASSET MANAGEMENT Co., Ltd., Orion Asset Management, and KB Asset Management.
Like the National Growth Fund, the National Participation Growth Fund will allocate 60% of its investments to 12 advanced strategic industries. Investment in the KOSPI Composite Index will be capped at 10%. New capital will account for 30% of the fund, with at least 10% each allocated to unlisted companies and KOSDAQ technology-special listing firms. However, more than 40% will be allowed for discretionary investment so that managers can make use of their expertise.
The National Participation Growth Fund is a five-year closed-end fund that does not allow redemptions. In other words, investors cannot withdraw early, meaning their money will be locked in.
An amount of 120 billion won, or more than 20% of the total sales target, has been set aside first for low-income investors. Tax benefits include income deductions of up to 40%, capped at 18 million won, and separate taxation on dividend income at 9% for five years from the date of investment. The annual subscription limit is expected to be capped at 100 million won per person. For ordinary accounts that do not receive tax benefits, the annual investment limit is 30 million won per person.
gogosing@fnnews.com Park So-hyun Reporter