Risk-free Asset

Korea was one of the only two countries among 30 emerging markets around the world that posted a net capital inflow into stock funds.
Korea was one of the only two countries among 30 emerging markets around the world that posted a net capital inflow into stock funds.

 

It has been found that a large number of global mutual funds and exchange-traded funds (ETFs) have bought stock funds investing in Korea in spite of the global stock market downturn of this year.

According to the Institute for International Finance’s recent analysis of Emerging Portfolio Fund Research data, those funds investing in Korean stocks recorded a net capital inflow of approximately US$105 million during the first three weeks of last month.

During the period, Korea and Bulgaria were the only two countries among 30 emerging markets around the world that posted a net capital inflow into stock funds. In addition, the former’s amount exceeded the latter’s. This seems to be because global investors are regarding Korea as a risk-free asset amid the ongoing global economic crisis.

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