Korea Investment Corp expects its AUM to rise to more than $100 billion this year from $86 billion at the moment, its president and CEO Hongchul (Hank) Ahn said, as the sovereign wealth fund celebrates its 10th year anniversary this month.
The additional funds expected from the Ministry of Finance will help boost KIC’s assets under management, he said.
KIC also plans to increase its alternative assets from 8% to 50% of more in the coming years so that it will maximize its return on investment, Ahn said.
“We truly have a long way to go and it is a daunting goal, given that our AUM keeps rising fast. Still, we will not be intimidated at all and we plan to increase the portion of alternative assets to 15% by year-end,” he said.
The fund’s five-year annualized return is at 7.4%, he said, and since its inception, it posted a 4.2% return. Last year, KIC had a 10.03% return, outperforming the benchmark given by the government and the Bank of Korea by 131 bps, he added.
KIC has initially invested in stocks and bonds. But its portfolio has been expanded to include inflation-linked bonds, commodities, private equity, real estate, hedge funds and special investments. It has also invested in emerging markets from 2010.
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