K-Defense ETFs set their sights on Middle Eastern oil money after New York... Hanwha Asset Management exports “investment IP” [fn Market Watch]

[Financial News] Hanwha Asset Management Co., Ltd. is seeking to attract Middle Eastern capital by leveraging ETFs focused on Korea’s defense and manufacturing industries. The strategy involves supplying the Middle East with investment strategies developed in Korea, following their introduction in the United States. The move is seen as an effort to export Korean-style investment intellectual property (IP) as global financial products, going beyond a simple overseas listing.
According to the financial investment industry on the 9th, Hanwha Asset Management Co., Ltd.’s PLUS Korea Defense Industry Index ETF (KDEF) and PLUS Korea Manufacturing Core Alliance Index ETF (KMCA) were cross-listed on the Abu Dhabi Securities Exchange (ADX) in the United Arab Emirates (UAE) on the 2nd. It marks the first time an ETF from a Korean asset manager has entered a Middle Eastern exchange.
The key to Hanwha Asset Management Co., Ltd.’s move into the Middle East is improving access to investments for institutional investors in the region. Unlike trading on the U.S. market through an existing overseas account, investors can invest in dirhams through local brokerages. This opens a new investment channel for some institutional investors as well.
Hanwha Asset Management Co., Ltd. is expanding into overseas markets based on the PLUS K-Defense ETF, which was listed in Korea in 2023. The U.S.-listed KDEF reached $200 million in assets under management (AUM) in just 15 months. The model is to take investment strategies proven in Korea and expand them overseas.
One notable aspect is the effort to build a local sales network. Hanwha Asset Management Co., Ltd. is working to provide product briefings and sales training for local brokers and financial institution representatives. The aim is to turn these efforts into actual investment inflows from institutional investors, family offices and others.
The cross-listing was made possible by a memorandum of understanding (MOU) signed by the New York Stock Exchange (NYSE) and ADX in 2023. The arrangement allows the same securities as the U.S.-listed ETFs to be traded in the Middle East.
Hanwha Asset Management Co., Ltd. is also pursuing listings on the London and Frankfurt stock exchanges. In the longer term, it is considering entering digital capital markets through ETF tokenization.
The asset management industry sees Korean firms’ overseas expansion broadening from listing products to exporting investment strategies and attracting local capital. Actual results, however, will depend on local trading volumes and the amount of capital brought in by institutional investors.
A senior asset management industry official said, “There is significance in supplying overseas investors with investment strategies developed by Korean asset managers,” adding, “The ability to secure a steady flow of capital through local sales networks will determine the competitiveness of a global ETF business.”

[email protected] Kim Kyung-ah Reporter