People Participation Growth Fund posts 0.5% return in first three months...46.3% of funds invested

[Financial News] The first People Participation Growth Fund recorded a cumulative return of approximately 0.50% during its first three months of operation. Some sub-funds incurred valuation losses, but the fund as a whole posted a positive return under a structure in which government funding and subordinated contributions from the fund managers absorb losses first.
According to the Financial Services Commission on the 26th, Mirae Asset Financial Group, Samsung and KB Asset Management, the managers of the People Participation Growth Fund’s public offering funds, published their first asset management reports that day. The reports covered operating status, returns, major investments and future management plans from the fund’s establishment on June 12 through September 11.
After a total of 10 sub-funds began investing on June 15, approximately 46.3% of their combined capital had been invested by September 11. About 80% of the invested amount, excluding cash-equivalent assets, went to advanced strategic industries.
As a share of total fund capital, investments in advanced strategic industries accounted for 35.9%, those in sectors outside advanced strategic industries for 7.9%, and bonds for 2.5%, among others. By asset type, the funds were diversified across listed stocks (28.4%), listed mezzanine securities (10.1%), unlisted stocks (0.7%) and unlisted mezzanine securities (4.6%), among others.
The cumulative return over three months was approximately 0.50% for the fund as a whole, but varied by sub-fund, ranging from -19.86% to 3.15%. As stock-market volatility increased after June and July, some sub-funds incurred valuation losses on their listed-stock investments. However, government funding and subordinated investments by sub-fund managers absorbed losses of around 20% first, allowing the fund as a whole to post a positive return. Actual returns for individual investors vary depending on the fees for their fund classes, including online and offline, and general and low-income classes.
The Financial Services Commission explained that, since the People Participation Growth Fund is a closed-end fund with a five-year term, its performance should be assessed from a long-term perspective. The fund's investment targets include assets such as unlisted stocks and mezzanine securities that are difficult to value immediately, and valuation dates differ by asset, so it may take time to gauge meaningful performance.
In their reports, the managers said they were diversifying investments beyond listed stocks to include unlisted stocks and mezzanine securities. Going forward, they plan to review key management matters, including portfolio holdings and investment ratios, in line with their sub-fund monitoring and risk management procedures.
The asset management reports are available on the websites of the three fund managers and the Korea Financial Investment Association. They will continue to be prepared and disclosed every three months.

[email protected] Jeonghwa Lee Reporter