US Dollar Investment
Mirae Asset Global Investments (investments.miraeasset.com) announced on March 30 that its “Mirae Asset U.S. Treasury Bond Fund,” which calculates its basic prices in U.S. dollars, will be sold through Woori Bank and KDB Daewoo Securities for the first time in Korea.
According to the Bank of Korea, the foreign currency deposits of residents amounted to US$63.7 billion (70.45 trillion won) as of the end of February, and 60 percent of them were deposits in U.S. dollars.
Due to the increase of overseas trade and the growing number of children studying overseas, the foreign currency deposits of residents have increased by 113 percent from US$29.9 billion (33.07 trillion won) in 2011, showing a steadily-increasing trend.
However, the fixed interest rate product is the only one that uses foreign currency. Therefore, the market is ripe for others.
The Mirae Asset U.S. Treasury Bond Fund provides stable interest earnings to investors who want to invest in U.S. dollars. It is also a product invested in U.S. dollar bonds, which is stably managed with a low credit risk.
The product expands interest earnings by investing in not only U.S. government bonds but also corporate bonds. Also, it will select and buy bonds that have a certain investment grade, minimizing the risks of price fluctuations due to interest rate fluctuations from the investment of some U.S. mortgages and pursuing excess earnings.
By investing directly in U.S. dollars, investors could benefit when the dollar is strong, and they don’t need to exchange money when they subscribe to funds and resell them. Also, dealing in U.S. dollars, the product is relatively free from the risks of exchange fluctuations and easy to resell.
Kim Sung-jin, chief officer in the bond management division at Mirae Asset, said, “As this long-desired fund, which invests directly in foreign currency, is released, it will help investors with foreign currency manage their portfolios.”