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DEEP RESEARCH · VIP KOREAN-STYLE VALUE INVESTING FUND

Reviewing the VIP Korean-Style Value Investing Securities Investment Trust [Equity]

A check of the structure and risks of a domestic equity active fund as a DC pension candidate

Written: 2024-12-19 · Retirement pension and active fund perspective · Naver Blog

Investment decisions are your own responsibility. This material is research and is not a buy or sell recommendation.

0. Bottom line first

While looking for a DC pension investment product, I reviewed the VIP Korean-Style Value Investing Securities Investment Trust [Equity], managed by the authors of Korean-Style Value Investing Strategy. I checked with the company that the current bond or cash allocation is almost nonexistent, and my main interest is that it has consistently outperformed KOSPI.

This is a domestic equity fund. It focuses on Korean stocks while its mandate also allows certain allocations to bonds and short-term assets.

Permitted investment rangesBased on the original post
Stocks60%~100%, Korean listed stocks
Bonds0%~40%, government, municipal, special, and A- or higher corporate bonds
Short-term assetsUp to 10%, deposits, short-term loans, repos, etc.
Company checkBond and cash weight is almost nonexistent now
A structure highly exposed to Korean equity volatility while seeking long-term performance

1. Fund Overview

ItemContent
Fund nameVIP Korean-Style Value Investing Securities Investment Trust [Equity]
Investment objectiveSeek returns mainly by investing in Korean stocks
ManagerVIP Asset Management Co., Ltd.
Risk ratingGrade 2, high risk

The fund selects undervalued stocks and companies with stable growth potential in the Korean equity market. It is heavily exposed to domestic equity volatility but seeks both stability and high returns over the long term.

2. Managers and Philosophy

The fund is managed by key portfolio managers at VIP Asset Management. The team runs the fund based on a philosophy focused on value investing and long-term returns, and is viewed as specialized in the Korean equity market.

ManagerRole and experience in sourceAUMNotes
Choi Jun-cheolCEO, 5 years 5 months management experienceApprox. KRW 811.6bnSeoul National University business graduate, VIP representative since 2003, domestic value-investing expert
Kim Min-kookCEO, 5 years 2 months management experienceApprox. KRW 844.4bnSeoul National University economics graduate, co-founder of VIP Asset Management, stable long-term strategy
Cho Chang-hyunTeam lead, 3 years 11 months management experienceApprox. KRW 577.7bnSeoul National University business graduate, strength in growth-stock investing
Park Sung-jaeTeam lead, 4 years 1 month management experienceApprox. KRW 548.9bnHandong Global University business graduate, balanced value and growth style

3. Fees and Performance

Online Ce

Lower sales fee

Summarized as a structure favorable for long-term investing because sales costs are lower.

Offline C

Advisory service

Sales compensation is higher, but advisory service is provided.

Performance fee

0.80% + 0~1.60%

Consists of a 0.80% annual base management fee and a 0~1.60% performance management fee.

The recent one-year return was summarized as outperforming. The source image shows the fund return at roughly more than twice KOSPI, indicating strong performance.

Recent one-year return material for the VIP Korean-style value investing fund

Interpretation: For an investor seeking Korean equity exposure in a DC pension account, the key is to verify the investment philosophy and persistence of long-term results rather than only short-term volatility.

4. Redemption Terms and Suitable Investors

  • Redemption: Early redemption is available.
  • Redemption fee: None.
  • Payment: Paid within about four business days after the redemption request.

This fund is suitable for long-term investors who can tolerate high volatility. I see it as fitting investments such as DC pensions that pursue stable returns over the long term. It depends heavily on stock-market performance, while the mandate also allows some investment in bonds and short-term operating assets.

5. Korean-Style Value Investing Philosophy and My Conclusion

The reason I looked into this fund is that it reflects the investment philosophy I learned from the book Korean-Style Value Investing Strategy. The book emphasized deep analysis of undervalued stocks and the importance of long-term investing, and introduced VIP Asset Management’s approach as a representative example. A fund based on that philosophy fits my own tendency to pursue long-term results.

VIP Korean-Style Value Investing Securities Investment Trust [Equity] mainly invests in Korean stocks while also being able to diversify partly into bonds and short-term assets. It has significantly exceeded its KOSPI benchmark over the past year and appears suitable for a long-term investment purpose.

However, investors must make decisions based on their own risk tolerance and investment horizon. This fund is suitable for investors prepared to accept both the possibility of high returns and volatility.

Official fact: The investment prospectus link attached in the original post is the VIP Korean-Style Value Investing Securities Investment Trust [Equity] prospectus PDF.

Pre-investment caution: this fund is a performance-distribution product with no principal guarantee, and losses can occur. Investors should carefully review the prospectus and return structure before investing.

The original post included an embedded fund-manager interview for readers interested in the fund philosophy, and also attached a related post for readers interested in the book.

Related review of the Korean-Style Value Investing book

Related post image for the Korean-style value investing book review

Sources

Naver original