Samsung Active Asset Management and Timefolio Asset Management simultaneously listed Korea's first KOSDAQ active exchange-traded funds on Monday, with retail investors pouring nearly 600 billion won into the two products on the opening day, demonstrating strong market expectations for KOSDAQ active ETFs.
The two products showed contrasting performances from day one due to their vastly different strategies in stock selection, weightings, and management approaches. Samsung Active's KoAct KOSDAQ Active ETF gained 11.94%, while Timefolio's TIME KOSDAQ Active ETF rose 4.13%.
Retail investors were net buyers of 296.8 billion won in Samsung Active's product and 284.7 billion won in Timefolio's. The KOSDAQ index closed at 1,137.68, up 35.40 points (3.21%) from the previous session.
Both ETFs track the KOSDAQ Composite Index as their benchmark, with Samsung Active holding 57 stocks and Timefolio holding 50. However, their strategies diverge sharply.
Samsung Active prominently features small and mid-cap stocks it has identified. Curient, ranked 71st by market capitalization on KOSDAQ, tops the portfolio at 8.97%, followed by Sungho Electronics at 8.82%, ranked 36th. Nearly 18% of the fund is allocated to stocks outside the top 30 by market cap. Both stocks surged near their daily limit on expectations of capital inflows from the active ETF inclusion.
Timefolio adopted a more conservative approach, focusing on large-cap stocks—a strategy analysts say reflects consideration for institutional demand from pension funds and other institutions. The fund allocates over 5% each to five core stocks in secondary battery, bio, and robotics sectors: Ecopro (9.76%), Ecopro BM (6.89%), Samchundang Pharmaceutical (6.27%), ABL Bio (5.13%), and Rainbow Robotics (5.03%). These five stocks account for 33% of total assets.
In contrast, Samsung Active holds only 2.04% in Ecopro and excludes Ecopro BM entirely.
The funds also differ in small-cap exposure. Samsung Active includes 17 stocks not in the KOSDAQ 150 index, representing about 16% of total assets. Timefolio includes only three such stocks, all weighted below 1%, totaling just 2% of assets.
Management fees also differ: Samsung Active charges 0.5%, while Timefolio charges 0.8%.
The two ETFs share 25 common holdings, including Ecopro, Samchundang Pharmaceutical, Rainbow Robotics, ABL Bio, and Leeno Industrial. Notably, both funds include small-cap secondary battery stocks Hanjung NCS (ranked 240th by market cap) and Almec (323rd). Both stocks, selected by fund managers at both firms as undervalued small caps, surged more than 10% on Monday.
Competition in the KOSDAQ active ETF market is expected to intensify amid the government's goal of raising the KOSDAQ index to 3,000. Hanwha Asset Management plans to launch its own KOSDAQ active ETF this month, using the KOSDAQ 150 as its benchmark index.
"Given that KOSDAQ stocks have less analyst coverage and earnings data compared to KOSPI stocks, the appeal of active ETFs will grow as they allow investors to gain diversified exposure to stocks carefully selected by each firm's fund managers," a securities industry official said.