Since the start of the year, bond mixed exchange-traded funds (ETF) that include both stocks and bonds have been growing rapidly amid concentrated demand from pension investors. Analysts said a savvy structure that maximizes the effective stock allocation while complying with the cap on risky assets in retirement pension accounts is strongly drawing buying from wealthy investors and individuals.
According to the financial investment industry on the 20th, IBK Asset Management recently completed the product code registration for the "IBK ITF U.S. AI TOP10 Treasury Mixed 50" ETF and is undergoing the final listing review by the Korea Exchange (KRX).
Recently, asset managers have been rolling out bond mixed ETFs one after another. On the 26th on the previous month, KB Asset Management listed "RISE Samsung Electronics SK hynix Bond Mixed 50," which combines Government Bonds with Samsung Electronics and SK hynix, and Samsung Asset Management also plans to launch "KODEX Samsung Electronics SK hynix Bond Mixed 50" as early as early Apr.
Bond mixed ETFs are asset allocation products that pursue both stability and profitability by including stocks such as Samsung Electronics or Tesla together with bonds.
Under current rules, retirement pension accounts cap the share of risky assets such as stocks at 70%, and the remaining 30% must be filled with safe assets such as bonds. But using bond mixed ETFs as a lever can increase the effective stock weight in the overall portfolio to as high as 85%.
For example, if an investor fully uses the 70% limit for risky assets and fills the remaining 30% safe assets with a bond mixed ETF, the exposure to risky assets increases by the stock share embedded in that ETF. Currently, single-name bond mixed ETFs are designed to hold up to 30% in stocks, and index-type products up to 50%.
Using this structure, the stock share on a total-portfolio basis can be expanded to about 79% (70% + 9% stocks within safe assets) for single-name products and about 85% (70% + 15% stocks within safe assets) for index-type products.
Amid this year's market gains, demand is rising from investors seeking to aggressively increase their stock allocation, drawing funds into related products. Bond mixed ETF assets under management (AUM) rose from 2.5604 trillion won at the end of 2024 to 8.0089 trillion won at the end of 2025, an increase of nearly 6 trillion won in one year. As of the 19th, the figure was 11.9745 trillion won, surpassing half of last year's gain in about three months.
The top product by net assets, the "KODEX 200 U.S. Treasury Mixed" ETF, recorded 1.4875 trillion won in AUM during the same period, up 137% from about 626 billion won. The No. 2 "KODEX Samsung Electronics Bond Mixed ETF" also joined the "1 trillion club" on the 11th. Individual investors made a net purchase of 22 billion won in this product over the past year, of which 14.9 billion won (67.8%) was net bought this year.
As the retirement pension market grows, some analysts say bond mixed ETFs will continue to expand. According to the Ministry of Employment and Labor (MOEL), provisional retirement pension reserves stood at 501 trillion won at the end of last year, up about 70 trillion won from a year earlier. Over the same period, the share of performance-based products also expanded from 17.4% to 24.8%.
Ha Jaeseok, an analyst at NH Investment & Securities, said, "The size of domestic retirement pension reserves is growing 15% annually and will reach 1,000 trillion won by 2030," and added, "Within performance-based products, the stock share is only 10%, and given countries such as the United States and Australia where the share exceeds 50%, there is ample room to buy stocks via ETFs in retirement pension accounts."
However, some note that this investing approach may run counter to retirement pension regulations designed for long-term investing.
Lee Hyoseop, a senior research fellow at the Korea Capital Market Institute, said, "The main purpose of retirement pensions is to secure stable income in old age, and that is why the share of safe assets was set," adding, "It is not desirable for bond mixed ETFs to be used to circumvent that intent."