Trading volume tops 30 billion won within minutes as investors seek broader exposure to Korea's AI-driven stock rally
CSOP Asset Management, Hong Kong's largest issuer of exchange-traded funds, on Thursday launched the city's first ETF tracking Korea's benchmark Kospi 200 Index, betting on growing global demand for Korean equities.
The CSOP Kospi 200 ETF began trading on the Hong Kong Stock Exchange, becoming the only ETF listed in Hong Kong and the Asia-Pacific region outside Korea that tracks the Kospi 200.
Investor demand appeared strong from the outset. According to CSOP, trading volume exceeded 30 billion won ($22 million) within the first five minutes of trading.
"Buy orders poured in from the start of trading," a CSOP official said. "For Hong Kong investors who previously had limited access to Korean equities, the ETF provides a new investment channel."
The launch marks an expansion of CSOP's Korea-focused product lineup. The asset manager has previously introduced leveraged and inverse products linked to Samsung Electronics and SK hynix, which gained popularity amid the AI-driven rally in Korean technology stocks. The new ETF offers investors diversified exposure to the broader Korean market through a benchmark index fund.
The ETF seeks to track the performance of the Kospi 200 Net Total Return Index before fees and expenses. It adopts a full-replication strategy, investing directly in all constituent stocks in the index. The fund is priced at 7.80 Hong Kong dollars ($1) per unit with a board lot size of 100 units and an annual management fee of 0.99 percent.
Korean equities have emerged as among the world's strongest-performing this year, supported by robust gains in semiconductor shares and strong foreign inflows. According to CSOP, the Kospi 200 has returned more than 130 percent since the beginning of 2026.
Technology stocks account for roughly 66 percent of the benchmark index, followed by industry at 13 percent and financial stocks at 7 percent. Major holdings include Samsung Electronics, SK hynix, SK Square, Samsung Electro-Mechanics and Hyundai Motor.
CSOP attributed the market's strength to the AI investment cycle, sustained foreign fund inflows and relatively attractive valuations. Global ETFs and exchange-traded products with exposure to Korean equities attracted $31.9 billion in net inflows in 2025, while inflows had already reached $30.5 billion as of the end of May this year, according to the company.
Despite the recent rally, the Kospi 200 trades at a forward price-to-earnings ratio of 9.02 times, compared with 22.39 times for the S&P 500, suggesting further room for valuation expansion, CSOP said.
"We believe Korea's equity market remains significantly underexplored by international investors, supported by its evolving market structure and growing relevance in global portfolios," said Ding Chen, chief executive of CSOP.
"The launch of the CSOP Kospi 200 ETF marks an important step in connecting Hong Kong investors with this opportunity."
ch0221@heraldcorp.com