KCGI Asset Management rolled out an active EMP (ETF managed portfolio) fund that selects and invests in global exchange-traded funds (ETFs), expanding its lineup of asset-allocation products. More than 10 billion won flowed in on the first day of launch.
KCGI Asset Management said on the 27th it launched the KCGI Global Active EMP Fund (equity–fund of funds). On the 24th, the setup date, the fund drew in more than 10 billion won.
The product targets ETFs across global equities, sectors, and themes. It applies a "dual momentum" strategy that selects ETFs with confirmed upward trends rather than relying on market outlooks or individual stocks.
Management uses a two-step screening method that combines absolute momentum and relative momentum. First, it filters for ETFs that maintain an uptrend and gradually reduces allocations to assets showing a downtrend. Then it again selects high-performing ETFs and adds them at equal weights, and for similar assets it holds only a representative ETF to reduce concentration in specific assets and overlapping investments.
To supplement the limits of a quantitative model, portfolio managers will also partially intervene in adding new investment themes and adjusting exposure to risk assets. The firm also plans to apply a management approach that cuts unnecessary turnover to lower transaction costs.
KCGI Asset Management noted the global ETF market is shifting from simple index tracking to selecting ETFs to pursue excess returns. In fact, the size of the global ETF market expanded from about $9 trillion in 2022 to about $20 trillion in the first quarter of this year.
A company official said, "The core of management is selecting strong assets according to quantitative rules rather than market outlooks," adding, "We plan to concentrate on assets in uptrends and mechanically reduce the weight of assets where the trend breaks to pursue improved risk-adjusted performance."
The fund is run as an unhedged, currency-exposed product, and its risk rating is Level 2 (high risk). The master fund invests 60% or more of its trust assets in ETFs, has an open-ended and additional-subscription structure, and charges no early redemption fee.