Shown above is the head office of Mirae Asset Global Investments in Seoul. The outfit’s leveraged ETF product, which tracks the China tech index, topped the list in terms of two-month profitability this month. Photo courtesy of Mirae Asset Global Investments

Mirae Asset’s product chalks up highest return in two months

South Korea’s Mirae Asset Global Investments announced on Jan. 10 that its Tiger China Hang Seng Tech Leverage ETF topped the podium in terms of profitability over the past two months.

As of Jan. 5, the Tech Leverage TEF chalked up a profit ratio of 76.41 percent in two months to remain atop the Korean list, beating the No. 2 product of KODEX China H Leverage with 60 percent.

No other ETF products surpassed the 30-percent plateau.

Brief for Exchange Trade Funds, ETFs are designed to track an index as compared to index funds. They are regarded as low-risk investments because of their diversification, affordable management feeds, and high price visibility.

Over the past several years, ETFs have gained traction across the globe thanks to their outstanding performances. Mirae Asset and Global X have been one of the global leaders in the ETF scene.

Tiger China Hang Seng Tech Leverage ETF is designed to track as closely as possible the price and yield performance of the Hang Seng Tech Index.

The index includes such high-tech giants as Alibaba, Tencent, Xiaomi, and Jingdong.

Because it is a leveraged ETF, it uses financial derivatives and debt to amplify the returns of an underlying index, in this case the Hang Seng Tech Index again.

While a conventional ETF tracks the securities in its underlying index on a one-to-one basis, the Tiger leveraged ETF has aimed for a 2:1 ratio since its debut last August.

“The Chinese reopening has boosted the e-commerce, restaurant, and tourism industries. In addition, the positive outlook for the entertainment industry underpins the Hang Seng Tech Index,” a Mirae Asset official said.