ACE "Korean Strategic Industry" ETF Launch... Jaegyu Bae: "Invest in Long-Term Direction Over Leverage"

ACE Semiconductor Plus Strategic Industry ETF Set to List
Jaegyu Bae: "Investing Is a Function of Direction and Time"
"Leverage Will Burn Those Seeking Fast Wealth"

Jaegyu Bae, known as the "father of ETFs" and CEO of Korea Investment Trust Management, emphasized that "successful investing requires two things: direction and time," and stated that, in Korea, it is best to invest in industries with well-established artificial intelligence (AI) infrastructure ecosystems. He added that leverage goes against the values of long-term investing.

At the ACE Semiconductor Plus Strategic Industry ETF New Listing Investment Seminar on August 10, CEO Bae said, "Selecting investment targets is a matter of 'direction,' while the 'time' that passes introduces investment volatility, which challenges one's emotions." He went on to encourage, "Invest in long-term growth for the future."

At the ACE ETF New Listing Seminar held on the 10th, Jae-Kyu Bae, President of Korea Investment Trust Management, delivered the welcoming speech. Korea Investment Trust Management

He explained that the ACE Semiconductor Plus Strategic Industry ETF, newly listed on the 11th, aligns with this investment formula. This ETF invests not only in semiconductors but also in shipbuilding, defense, nuclear power, humanoids, and the automobile sectors. CEO Bae said, "The companies driving future growth are tech firms utilizing new technologies, such as those included in the Nasdaq 100. While these technologies are mostly based in the U.S., Korea has the infrastructure. Industries with well-developed ecosystems here include semiconductors, power, shipbuilding, defense, and nuclear power."

CEO Bae further emphasized that the ACE Semiconductor Plus Strategic Industry ETF is better suited for long-term investment than either the KOSPI 200 or individual thematic ETFs. He said, "The KOSPI 200 represents investing in the entire market and reflects Korea's 'present,' whereas we are investing in Korea's 'future' through competitive growth industries, encompassing the entire advanced manufacturing industry ecosystem that is interconnected." In comparison with theme ETFs such as those focused on semiconductors, automobiles, shipbuilding, defense, and nuclear power ("Jobangwon"), he pointed out, "Each theme has its own growth cycle, requiring investors to calculate the leading stocks and the right timing. Our product reduces volatility by blending industries with different economic cycles."

He maintained a negative position on single-stock leverage products, which are cited as increasing volatility in the Korean stock market. Earlier, CEO Bae commented on social media regarding single-stock leverage products, stating, "The best choice is not to use them. They should be allowed to die a natural death, not delisted." At the seminar, he cited cases where long-term investment led to higher returns, saying, "Many people are investing in cheap stocks or using leverage to earn money immediately. However, with leverage, volatility becomes too great to withstand. Even if you're right about the direction, if you can't endure the volatility that comes with the passage of time, you won't be able to make money."

Sunyeop Lee, CEO of AFW Partners, also presented a market outlook at the seminar. He stated, "Industries driving Korea's structural stock market growth include semiconductors, shipbuilding, defense, and nuclear power. These sectors are not only building moats amidst global political dynamics such as U.S.-China rivalry, but also possess long-term growth engines that make continual profit increases possible, rather than one-off events."

CEO Lee said, "The semiconductor industry, Korea's flagship sector, is experiencing a reevaluation as a monopoly essential infrastructure in the AI superpower race, moving beyond the framework of a cyclical industry into a new phase." He continued, "Shipbuilding has entered a long-term super cycle; defense is drawing attention due to rising global defense budgets and competitive productivity and delivery times; and nuclear power is being highlighted as a fundamental solution to AI data center power shortages, creating a favorable environment for Korea-U.S. nuclear cooperation in particular."

The ACE Semiconductor Plus Strategic Industry ETF diversifies its investments across five domestic industries with global competitiveness. Four of these industries are semiconductors, shipbuilding, defense, and nuclear power, with the fifth—selected from Korea's major industries including automobiles, secondary batteries, pharmaceuticals and biotech, or entertainment—added based on industry scale and other factors. Yongsoo Nam, Head of the ETF Division at Korea Investment Trust Management, explained, "It is a product that implements active ideas in a passive format. Based on our philosophy, we defined industries through active research, and designed passive rules for constituent weightings and flows to prevent index concentration."

He also drew connections between the jobangwon sectors (shipbuilding, defense, nuclear power) and the AI industry, stating, "We consider jobangwon to be essential physical and national infrastructures in the AI era. Operating AI requires computation, computation requires electricity, electricity generation requires energy, energy must be transported, and a secure supply chain environment is critical."

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