Samsung Asset eyes expansion into US ETF market

NEW YORK – South Korea’s largest asset manager Samsung Asset Management Co. is leveraging its strategic partnership with a US investment firm to increase exchange-traded fund (ETF) sales and appeal to both Korean and US investors.

Samsung will continue to list its innovative ETFs on overseas markets, including the next one to debut in the US in August, said the asset manager’s Chief Executive Seo Bong-kyun at the opening bell ceremony for New York Stock Exchange-listed Amplify Samsung SOFR ETF on Monday.

The ETF debuted on the US market last November by Illinois-based Amplify Holding Company LLC and is managed by Samsung. The fund's net assets are valued at $155.8 million, with a $100.56 closing price on April 22. The New York-listed fund’s monthly distribution rate was 5.34% as of March 31.

Samsung’s ETF assets under management amounted to 51.96 trillion won ($37.7 billion) as of the end of 2023. With a 40% share of the Korean ETF market, it strives to widen the gap with the biggest crosstown rival Mirae Asset Global Investments Co., which has a 37.2% share. 

IDENTICAL STRATEGIES

The US ETF has the same strategy and structure as Samsung Kodex US dollar SOFR Active, which debuted in Korea in March 2023. Samsung said the New York-listed ETF is the first US financial product that has followed a Korean ETF investment scheme.  

Amplify Samsung SOFR ETF seeks to provide investors with monthly income equal to the Secured Overnight Financing Rate (SOFR) after fees and expenses.

SOFR, a reference rate alternative to the London Interbank offered rate (Libor), is a broad measure of the cost of borrowing cash overnight collateralized by US Treasuries and represents minimal duration risk.

Samsung and Amplify have jointly launched ETFs since 2022 as the Korean asset manager, Amplify’s second-largest shareholder with a 20% stake, received rights to exclusively provide the US ETF sponsors’ products in Asia.

The Korean asset manager listed Samsung Blockchain Technologies ETF on the Hong Kong Stock Exchange in 2022. It is an actively managed fund that mimics the strategy of the Nasdaq-listed actively managed fund Amplify Transformational Data Sharing ETF (Blockchain).

In the same year,  Samsung listed Kodex US Dividend Premium S&P Active ETF in Korea, which employs the same strategy as the Amplify CWP Enhanced Dividend Income ETF that tracks the Standard & Poor's 500.

Write to Sin-Young Park at nyusos@hankyung.com

Jihyun Kim edited this article.