Shinhan Asset Management announced Thursday that its Shinhan Snowball Income Fund has achieved the top five-year return among bond-equity hybrid public funds.
According to fund evaluator Zeroin, the fund recorded a five-year return of 67.31% as of January 7, ranking first within its category. The fund has maintained consistent performance across medium to long-term periods, posting returns of 60.27% over three years and 57.09% over one year.
Capital inflows have accelerated rapidly on the back of this strong performance. The fund's net assets stood at just 74.8 billion won at the end of last year but have grown to 235.4 billion won after attracting more than 160 billion won since the beginning of the year. The surge is attributed to accumulated investor confidence in the fund's long-term track record.
The Shinhan Snowball Income Fund employs the "snowball effect" as its core investment strategy, targeting companies whose corporate value grows at a compounding rate over time. The fund focuses on long-term investments in companies with stable return on equity (ROE), pursuing appreciation in corporate value through a structure where profits are reinvested and capital expands. Additionally, the fund combines stocks and bonds through an asset allocation strategy that seeks both stability and profitability.
The equity allocation is flexibly adjusted between approximately 20% and 50% depending on market conditions. For bonds, the fund focuses on securities rated BBB- or higher with durations of one to three years to reduce volatility while capturing both interest income and capital gains. Shinhan Asset Management targets annual returns of 5% or higher. Major holdings include leading Korean companies such as Samsung Electronics, SK hynix, Kiwoom Securities, and Shinhan Financial Group.
"The market has become more volatile due to inflationary pressure from high oil prices stemming from tensions between the U.S. and Iran, as well as reduced expectations for U.S. interest rate cuts," said Kim Han-sol, manager of Shinhan Asset Management's Equity Investment Team 2. "We plan to reduce volatility by applying more conservative ROE assumptions than last year and selecting stocks that can maintain stable earnings per share."