INVESTING/PORTFOLIO STRATEGIES

Samsung Asset Management, Capital Group launch target-date funds in Korea

Samsung Asset Management and Capital Group announced Thursday the launch of a target-date fund series for Korean investors, composed of 11 underlying Capital Group funds.

It was the first announcement since the two groups forged a strategic partnership in October to cooperate in developing asset management products for the Korean market.

The firms launched six target-date funds with retirement date years of 2020, 2025, 2030, 2035, 2040 and 2045. A Samsung-Capital news release Thursday said the funds will be managed 30 years past those retirement dates to ensure that investors “can use a single fund for their entire lives.”

The news release noted that while Korea's target-date fund market has a mere $6.6 million in assets at present, a recent regulatory change lifting the amount of retirement funds that can be invested in equities to 82% from 40% should pave the way for strong growth going forward.

In what was termed a “unique glidepath within a glidepath” suited to Korea, Samsung and Capital said a centerpiece of that path will be a shift from “growth-oriented equities to income-oriented equities” over time.

A spokeswoman for Capital couldn't immediately say if the Capital Group global equity and bond funds serving as components of the target-date funds would be hedged.