As the semiconductor boom continues, ETFs are also shifting toward stocks, with the share of domestic equity funds topping 50%

[Financial News] As the semiconductor rally continues, domestic equity funds have come to account for more than half of the exchange-traded fund (ETF) market.
According to FnGuide on the 21st, the total net assets of domestic ETFs stood at 527.0508 trillion won as of the 18th. That is up 229.9107 trillion won, or 77.4%, so far this year.
In particular, net assets of domestic equity ETFs reached 263.5401 trillion won, accounting for more than 50% of the total. It is the first time since June 2023, when total domestic ETF net assets exceeded 100 trillion won, that domestic equity funds have surpassed the halfway mark.
Net assets in overseas equity funds totaled 141 trillion won, accounting for 26.7% of the total.
At the end of 2024, domestic equity fund net assets were only around 40 trillion won, representing 24.3% of the total. But as the stock market gained momentum in the second half of last year, the share rose to 31.4% in late last year, or 93 trillion won, and then expanded further to 36.8%, or 128 trillion won, by the end of January.
The sharp rise in KOSPI, which has repeatedly hit record highs this year, appears to have driven the increase in domestic equity funds. KOSPI has surged 115.1% so far this year through the 18th. By contrast, over the same period, the Standard & Poor's Index rose 9.6%, while the Nasdaq Composite Index gained 14.1%.
The reduced appeal of bonds during the rate-hike cycle is also one of the factors encouraging money to flow into the stock market.
As of the 18th, net assets of domestic bond ETFs stood at 63.483 trillion won, up just 2.6% from 61.8506 trillion won at the end of last year. Their share of total ETFs fell from 20.8% at the end of last year to 12.0% now.
Lee Jae-man, a researcher at Hana Securities, said, "The number of stock-related ETFs in Korea rose from 536 in January last year to 615 at the end of last month," adding, "ETFs tracking specific industries or sectors are growing faster than index-tracking products."
jisseo@fnnews.com Seo Min-ji Reporter