KB Asset Management will introduce the first exchange-traded fund (ETF) in Korea to invest in the value chain (supply chain) related to overseas game companies. KB Asset Management presented a blueprint to secure growth by increasing the investment weight centered on console game corporations.
According to the financial investment industry on the 30th, KB Asset Management plans to list "RISE Global Game Tech TOP3 Plus" on Oct. 21. Only the Korea Exchange's final review remains.
RISE Global Game Tech TOP3 Plus focuses on Japan's Sony, Hong Kong's Tencent, and U.S. Microsoft (MS), the No. 1 to No. 3 game companies by market capitalization. The inclusion weights are expected to be in the mid-10% to low-20% range, respectively. In addition, it composed the underlying asset with about 10 stocks, including value-chain corporations such as Nintendo and Nvidia.
KB RISE Global Game Tech TOP3 Plus is the first ETF to invest in overseas game companies. Broadening to all game-themed ETFs, it comes about four years after the "HANARO Fn K-Game" ETF launched by NH-Amundi Asset Management.
Currently, five game-related ETFs are listed on the domestic stock market, including "KODEX Game Industry," "RISE Game Theme," "TIGER K-Game," and "TIGER Game TOP10." They include domestic game developers such as NCSOFT, KRAFTON, Netmarble, Pearl Abyss, and SHIFT UP. The share prices of these ETFs rose about 3% to 10% this year through 29th.
KB Asset Management said KB RISE Global Game Tech TOP3 Plus is differentiated in that it is centered on console game corporations. A KB Asset Management official said, "We judged that console game corporations have greater potential to expand into platforms such as related information technology (IT) businesses," adding, "That means they can generate more profit."
The market expects the global console game market to grow 5.5% this year from last year, roughly double the growth rates of the mobile game (2.9%) and PC game (2.5%) markets. Console game devices are also continuing to come out. Nintendo released the Switch 2 in June, and Sony and Microsoft plan to launch the PlayStation 6 and next-generation Xbox in 2027.
On 29th, Ahn Jae-min, an analyst at NH Investment & Securities, said in a report titled "Tokyo Game Show 2025 field notes," "Unlike mobile games, which have many substitutes, the console market for enjoying game content is in continued growth, and the approximately seven-year cycle of console device upgrades is also a steady driver of user inflows."
Share price gains were also notable. Sony's shares have risen 29% this year. Nintendo and Tencent shares climbed 41% and 59%, respectively.
However, there is a possibility that KB RISE Global Game Tech TOP3 Plus may fail to keep up with market trends because it has a low weight in mobile games, which account for more than half of the overall game industry.
With a high weight in Tencent, there are also policy risk factors. Tencent is a case where its share price plunged more than 70% from its peak as the Chinese government tightened game regulations from 2021 to 2022.
Also, as it is a currency-exposed product that does not use currency hedging (hedge), investors should consider the possibility of losses due to exchange rate fluctuations.