Korea Investment Management said Wednesday it has launched the "Korea Investment Level Up Korea Fund (private investment fund-of-funds type)," which invests intensively in leading industries and capital market policy beneficiary stocks expected to drive a mid- to long-term revaluation of the domestic stock market.
Korea Investment Management designed the fund based on its assessment that the Korean stock market has entered a phase of fundamental structural improvement. The core approach is to select and hold key stocks expected to contribute to an upward trajectory in the market, as earnings momentum led by the semiconductor sector creates synergy with the government's value-up (corporate value enhancement) policy.
The main investment themes fall broadly into two categories: "Korea's core industries" and "capital market policy beneficiaries." In the core industries segment, the fund incorporates the AI value chain and semiconductors, physical AI (robotics and mobility), and security-related stocks (defense and shipbuilding). In the policy beneficiary segment, which targets qualitative growth, the fund allocates capital to K-corporate-value-related stocks expected to benefit from the resolution of PBR (price-to-book ratio) discounts through measures such as revisions to the Commercial Act, as well as to Samsung Group stocks and blue-chip KOSDAQ stocks.
The product is a public fund-of-private-funds that invests in seven sub-private funds, each with an equal weighting of approximately 14%. To lower the risk of principal loss for investors, it is structured as a "profit-loss differentiated" fund, in which general investors' funds enter as senior tranches and contributions from affiliates under Korea Investment Holdings enter as junior tranches. Under the structure, if losses occur, junior investors absorb up to 15% of each fund's net assets first. Conversely, if profits are generated, up to the 10% return range, senior and junior investors share proceeds evenly according to their respective contribution weights, while excess returns are distributed 55% to senior investors and 45% to junior investors.
Subscriptions are available through Korea Investment & Securities and Shinhan Bank PWM center branches until the 22nd. Jang Ju-young, head of Korea Investment Management's Equity Management Division 1, who oversees the fund's operation, said, "Although the domestic stock market is currently showing somewhat high volatility, the earnings rally will continue, driven by a surge in global AI hardware demand." He added, "We designed it so that through the profit-loss differentiated structure, downside risk is defended as much as possible while allowing investors to enjoy the performance of the domestic market's leading stock rally in a bull market."
