Suffering Minus Earnings Rate
None of Korea's 2,688 stock-type funds with assets more than 1 billion won (US$900,000) yielded a profit this year, according to FnGuide Inc., a financial information service provider.
The average earnings rate of the entire Korean stock-type funds hit minus 19.33 percent, worse than the 16.72% drop of KOSPI and the 16.11% negative growth of KOSDAQ this year. Index-type equity funds, which follow the stock index, recorded a loss of 21.72%.
Considering the fact that 1% or so was paid for fund management, it would have been much better for stock investors to leave their money at their banks and collect an annual interest of around 2%.
As the stock market has a gloomy outlook for next year, Korean stock-type funds are expected to continue to bleed. "Although the U.S. has slowed down its interest rate hike, there is no momentum to raise the yield of public offering equity funds as there are concerns over an economic slump and no positive factors to take the lead in revitalizing the stock market in Korea,” said Lee Dong-ho, managing director of Korea Investment Trust Management.