Among the domestically listed exchange-traded funds (ETFs), the 'concentration-type' ETF, which increases the weight of a few core stocks rather than holding a balanced portfolio of the entire sector, has shown better revenue. This is interpreted as a result of the remarkable rise in stock prices of leading stocks in a bullish market.
According to the Korea Securities Computing Corporation's 'ETF CHECK' on the 24th, the Korea Investment Management ETF 'ACE Global Semiconductor TOP4 Plus SOLACTIVE' has risen 16.3% in stock price this year. In comparison, Samsung Asset Management's 'KODEX U.S. Semiconductor' and Mirae Asset Global Investments' 'TIGER U.S. Philadelphia Semiconductor Nasdaq' recorded stock price increases of 7.8% and 2.9% respectively, highlighting the impressive performance.
The extent to which major stocks are included has led to a revenue gap. The ACE Global Semiconductor TOP4 Plus SOLACTIVE ETF has over 80% weight in four stocks: SK hynix (22%), NVIDIA (22%), TSMC (22%), and ASML (15%). The stock prices of SK hynix and NVIDIA have risen 57.1% and 20.8% respectively this year, boosting the revenue.
On the other hand, KODEX U.S. Semiconductor and TIGER U.S. Philadelphia Semiconductor Nasdaq do not include SK hynix as an underlying asset, and the inclusion ratio of NVIDIA is relatively low. Instead, they contain various other global semiconductor stocks in proportions of 4% to 12%.
The number of included stocks in ACE Global Semiconductor TOP4 Plus SOLACTIVE is relatively low at 11. KODEX U.S. Semiconductor and TIGER U.S. Philadelphia Semiconductor Nasdaq have 27 and 31 stocks respectively. In a phase where stock prices are rising centered around leading stocks, this concentration has translated into revenue.
Concentration-type ETFs have also performed well in other themes. In the global nuclear sector, KB Asset Management's 'RISE Global Nuclear' has risen 60% this year, featuring a 57% weight in three stocks: Doosan Enerbility, Cameco (CCJ), and Constellation Energy (CEG).
Among defense sector ETFs, Hanwha Asset Management's 'PLUS K Defense' and Mirae Asset Global Investments' 'TIGER K Defense & Space' have each seen stock price increases of about 167% this year. Both ETFs have a high weight of approximately 80% in five stocks.
However, due to the characteristics of concentration-type ETFs, the underperformance of a few stocks can negatively impact the overall revenue of the ETF. This concern aligns with the financial authorities' aim to limit extreme stock concentration in line with the ETF's purpose of encouraging diversified investment. ETFs are required to have at least 10 different stocks, and the weight of a single stock must not exceed 30%.
A spokesperson from an asset management firm said, "In a rising market like now, you can achieve results that significantly exceed the market index, but during a correction phase, the declines can be substantial."