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Korean Non-taxable Foreign Equity Fund Attracts Nearly 2 Trillion Won
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Korean Non-taxable Foreign Equity Fund Attracts Nearly 2 Trillion Won
  • By Yoon Yung Sil
  • August 10, 2017, 04:30
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South Korea will no longer accept new members of non-taxable foreign equity funds after the end of this year.
South Korea will no longer accept new members of non-taxable foreign equity funds after the end of this year.

 

The amount of South Korea’s non-taxable foreign equity fund products is continuously growing. The non-taxable foreign equity fund offers tax exemption benefits on returns from trading stocks listed on foreign exchange markets as well as valuation and foreign exchange gains and South Korea will no longer accept new members after the end of this year.

According to the Korea Financial Investment Association on August 9, the total amount of non-taxable foreign equity funds sold in the country as of the end of July reached 1.88 trillion won (US$1.65 billion) or 442,000 accounts. The figure increased by 196.7 billion won (US$172.62 million), or 38,000 accounts, from the previous month. The products worth 160.1 billion won (US$140.5 million) were newly sold in May and 170.6 billion won (US$149.71 million) in June. This was largely due to the fact that an increasing number of investors wanted to open accounts before the system is to close on December 31.

Among non-taxable foreign equity funds, the top 10 funds based on sales volume attracted 919.3 billion won (US$806.76 million), accounting for 48.8 percent of the total.

By fund operator, both securities firms and banks saw their sales volumes and number of accounts rise. The sales volume of banks stood at 1 trillion won (US$879.51 million), while that of securities companies reached 868.5 billion won (US$762.18 million). The payments made per account of securities companies amounted to 5.42 million won (US$4,756), which is higher than 3.59 million won (US$3,151) of banks.