The "KOSDAQ Global Index," which selects premium KOSDAQ-listed companies, posted strong performance this year despite a weak KOSDAQ market. However, funds flowed out of exchange-traded funds (ETFs) tracking the index, widening the gap between index performance and investment demand.
According to the Korea Exchange on Monday, the KOSDAQ Global Index rose 6.71 percent from the start of the year as of that day. Over the same period, the KOSDAQ index fell 10.18 percent and the KOSDAQ 150 index dropped 5.37 percent. While the broader KOSDAQ market weakened, KOSDAQ Global benefited from selecting relatively premium companies.
The index's performance did not translate into ETF fund inflows. As of Sunday, the combined assets under management (AUM) of the TIGER and KODEX KOSDAQ Global ETFs stood at 35.1 billion won. While this was higher than the 23.6 billion won at the start of the year, it was down 56.9 billion won, or 61.9 percent, from this year's peak of 92 billion won on March 6. TIGER KOSDAQ Global fell 45.8 billion won, or 80.2 percent, over the same period, while KODEX KOSDAQ Global dropped 11 billion won, or 31.6 percent. The two products hold KOSDAQ large-cap stocks such as Alteogen, EcoPro, EcoPro BM, and Jusung Engineering among their top holdings.
KOSDAQ Global is a premium segment that selects 50 KOSDAQ-listed companies with strong management performance, financial condition, and market valuation. It was introduced in 2022 to complement the single-market structure that manages more than 1,500 companies in one market. The aim was to reduce undervaluation of large premium companies and, like Nasdaq, raise the market's brand value through representative companies. However, contrary to its introduction, the investment base has instead shrunk. In fact, KOSDAQ Global's trading volume the previous day was 17.8 million shares, down 6.8 percent from 19.1 million shares at the start of the year.
The market also attributed KOSDAQ Global's weakness to the limitations of KOSDAQ itself. KOSDAQ closed at 831.23 on Monday, down 1.87 percent from the previous trading day, marking its lowest point this year. The TIME and KoAct KOSDAQ Active ETFs, which listed on March 10 this year amid expectations for KOSDAQ revitalization policies, currently show returns of minus 35.3 percent and minus 31.0 percent, respectively. This means that even active ETFs, which fund managers operate with the goal of outperforming their benchmark indices, are underperforming the market.
