"Single-Stock Retirement Investing Is 'Casino Roulette'... Global Diversification Strategy Needed"

"Retirement Assets, Diversify Investments and Disperse Risk"

The Importance of Adjusting Assets Over Time Through the 'Glidepath'

Hanaro TDF Utilizes Tactical Asset Allocation

Matthias Schieber, Head of Multi-Asset at the global asset management firm Allspring, stated, "Predicting stock price movements with accuracy is no different from playing roulette at a casino, so retirement assets should not be invested in risky single stocks." He emphasized, "It is essential to adopt a diversified investment strategy and disperse risk in order to achieve consistent results."

Schieber made these remarks on June 18 at the "Hanaro TDF Investment Strategy Meeting" co-hosted by NH-Amundi Asset Management and Allspring, highlighting the importance of globally diversified portfolios for Target Date Funds (TDFs).

On the 18th, Matthias Schieber, Head of Multi-Asset at Allspring, is presenting at the "Hanaro TDF Investment Strategy Meeting" held at The Plaza Hotel in Seoul. NH-Amundi Asset Management

Allspring is a global multi-asset manager that launched the world’s first TDF in 1994. At the event, Frank Cooke, Head of Global Solutions, and Matthias Schieber, Head of Multi-Asset at Allspring, presented a glidepath-focused TDF management strategy and their market outlook. Seokhwan Kim, Solution Team Leader at NH-Amundi Asset Management, followed with a presentation on the current status of Hanaro Qualified TDF management.

Schieber noted, "When investors panic and realize losses during correction phases, as seen in 2022, it becomes difficult for them to return to the stock market. This leads to long-term losses in returns." He stressed the importance of optimizing long-term returns on retirement assets through risk management and portfolio diversification.

In line with this philosophy, Hanaro TDF not only has exposure to Korean equities but also to global stocks, using tactical asset allocation (TAA). "Although the stock market environment has been favorable in recent years, there have also been periods of decline in the long term," he said. "When such declines occurred, we proactively reduced our equity allocation, and the time required to recover losses was shorter than for retail investors."

Recently, taking into account the US-Iran war and the AI supercycle driving the boom in the Korean stock market, the TAA was revised to increase the Korea allocation to a maximum of 10 percent. Seokhwan Kim, Solution Team Leader of the Global Solutions Division at NH-Amundi Asset Management, explained, "Recognizing that Korean equities are a core asset in the AI big cycle, we decided to make changes to tactical asset allocation as of May. Previously, we maintained a 7 percent allocation to Korea, but starting in May, we added 2.5 percent each to the AI and semiconductor sectors within Korea, increasing the Korea allocation by about 5 percent. We have raised the maximum Korea allocation to 10 percent to respond more flexibly to market changes."

However, the focus on global allocation and diversification remains unchanged. Dongwoo Park, Head of WM Pension Marketing at NH-Amundi Asset Management, said, "Over the past year, the Korean equity market has been exceptionally strong, so some TDFs have raised their Korea allocation significantly. In our case, rather than concentrating on the market, we are gradually increasing our Korea allocation while maintaining a balanced approach to asset allocation. Hanaro TDF is a retirement pension product true to the principles of asset allocation, and as we have consistently maintained strong long-term performance, our assets under management have grown rapidly."

As of the fund management results on May 31, Hanaro Qualified TDF ranked first in its category for five-year returns with the 2025 vintage (39.52 percent), while the 2030 (56.94 percent), 2035 (65.83 percent), and 2040 (72.54 percent) vintages each ranked second, maintaining top positions among major vintages.

On the 18th, at The Plaza Hotel in Seoul, Frank Cook (center), Head of Allspring Global Solutions, Matthias Schaeber (right), Head of Allspring Multi-Asset, and Kim Seokhwan, Solution Team Leader at NH-Amundi Asset Management, are conducting a Q&A session at the 'Hanaro TDF Investment Strategy Briefing'. NH-Amundi Asset Management

Asset allocation over time is also a key factor. Frank Cooke emphasized that the "glidepath" is a core strategy for achieving successful retirement outcomes. Glidepath refers to an asset allocation plan that systematically adjusts the proportion of risky assets such as equities over time. He explained that as retirement approaches, it is essential to shift the portfolio toward capital preservation.

Cooke believes that stable investing focused on risk management, rather than chasing high returns, is the key to building retirement assets. He said, "The KOSPI may offer greater gains than a TDF, but it can also result in significant losses that could be disastrous for retirees. The glidepath, which incorporates diversification and risk management, limits extreme downside risk and pursues more stable retirement outcomes instead of simply chasing higher returns."

Regarding future TDF management plans at NH-Amundi Asset Management, Kim stated, "Hanaro Qualified TDF pursues active asset allocation based on Allspring’s global management capabilities and our understanding of the domestic market. We aim to contribute to the long-term growth of retirement assets through stable management and systematic risk control."

This content was produced with the assistance of AI translation services.