50% in Samsung Electronics, SK hynix and Micron, 50% in bonds as Korea Investment Management lists hybrid ETF

[Financial News] A bond-and-equity exchange-traded fund (ETF) investing in three global memory semiconductor companies—Samsung Electronics Co., Ltd., SK hynix and Micron Technology, Inc.—alongside domestic short-term bonds is set to launch. It is designed with its equity allocation reduced to around half, allowing investors to allocate up to 100% of their retirement pension accounts to the fund.
Korea Investment Management Co., Ltd. said on the 3rd that it would list a new ACE Global Memory Semiconductor TOP 3 Bond Blend Active ETF.
The product will invest around 50% each in global memory semiconductor companies and domestic bonds. For the equity portion, stocks will be selected based on their connection to memory semiconductors, including DRAM, NAND and high-bandwidth memory (HBM). As of the day before listing, the planned holdings are Micron Technology, Inc., Samsung Electronics Co., Ltd. and SK hynix.
The three companies are major players in the DRAM and HBM markets and are positioned to benefit from rising memory demand as investment in AI data centers expands.
The bond portion will consist mainly of Korean Treasury bonds with remaining maturities of more than one month and up to two years, and Monetary Stabilization Bonds with remaining maturities of more than one year and up to two years, among others. The portfolio will be rebalanced daily to maintain the balance between stocks and bonds.
With bonds accounting for half of the overall portfolio, investors can also allocate up to 100% of their defined-contribution (DC) retirement pension plans and individual retirement pension (IRP) accounts to the ETF.
The ETF will also make monthly distributions. Using dividends, interest income and trading gains from its holdings as the source, it will set the last business day of each month as the distribution record date and pay distributions early the following month.
Weon Jae Kim, a manager in the Global Equity Management Division at Korea Investment Management Co., Ltd., said, “This product offers one-stop investment in leading companies driving the global memory market, while its high bond allocation allows investors to invest up to 100% of their retirement pension accounts in it.” He added, “It was designed to let investors consider semiconductor and pension investments together.”  


[email protected] Bae Han-geul Reporter