India equity funds top overseas stock funds in S.Korea
Man-Su Choe
Feb 19, 2024 (Gmt+09:00)
India equity funds registered in South Korea have doubled their investors' wealth over the past five years, luring high-net-worth individuals looking for alternatives to the Chinese stock market, data showed.
The net asset value of 28 India equity funds in South Korea has ballooned to 2.056 trillion won ($1.5 billion) from their original investment of 1.0 trillion won during the period, according to data provider FnGuide on Monday. It was the first time their net asset value surpassed 2 trillion won.
They returned 34.13% on average per annum, just shy of US equity funds’ gain of 36.43%. US funds were the top performer among overseas equity funds on an annual basis.
Their returns significantly beat an 18.51% gain from Vietnam funds and contrasted with a 26.04% loss from Chinese funds.
By net asset value, India equity funds ranked third after US stock funds with 22.57 trillion won and Chinese stock funds with 5.19 trillion won.
THREE-YEAR PERFORMANCE
On a three-yearly basis, India equity funds topped the list of overseas stock investment funds in the country in terms of performance, generating an average return of 62.16%.
Equity funds investing in the US and Japanese stock markets returned 41.23% and 31.84%, respectively, over the past three years.
By fund, Samsung India's small-cap FOCUS fund was the top performer with a return of 59.86%, followed by Mirae Asset Pension India Infra (50.69%), Shinhan India (30.76%) and Fidelity India (28.38%).
The equity-traded fund “KOSEF India NIFTY50” logged a 23.61% return.
“India is classified as an emerging market fund but delivered steady returns unlike US funds with heavy fluctuations,” said a private banker at a brokerage company branch in the affluent Gangnam district in Seoul.
“Funds with mid- to long-term targets such as retirement pensions are steadily flowing in (India equity funds),” he added.
Morgan Stanley forecasts India to grow to the world’s third-largest stock market by 2030. Its economy is projected to grow 6.5% this year, according to the International Monetary Fund, higher than the estimated global economic growth of 3.1% and the projected 4.6% expansion for China.
India’s stock market capitalization exceeded $4 trillion as of the end of January, beating that of the Hong Kong stock market.