In South Korea’s rapidly evolving financial landscape, the appetite for exchange-traded funds (ETFs) is hitting new highs. From the launch of innovative ETF platforms to surging fund inflows and a strategic pivot by asset managers toward active products, the country’s ETF market is experiencing a transformation that’s hard to ignore.
On February 28, 2026, Korea Investment & Securities will roll out its new “ETF Market” service through its flagship mobile app, “Korea Investment,” according to KPI News. This move is a direct response to the explosive growth in ETF demand among retail investors, especially those seeking digital, tax-advantaged investment options. The new service is designed to let users browse, compare, and trade ETFs from major asset managers or by investment theme—all from the home screen. Notably, it enables instant transactions and provides transparent information for investors using ISA intermediary, personal pension, and retirement pension accounts. There’s just one catch: users will need to update their app to access the new features.
Market data supports this digital push. KPI News reports that customers using the company’s “Bankis” non-face-to-face and bank partnership service saw their ETF holdings jump by 22% in January 2026 alone. For those using ISA intermediary accounts—popular for their tax benefits—ETF balances soared by 29% over the same period. Korea Investment & Securities says it is “enhancing the non-face-to-face investment environment so customers can easily find and trade ETFs suitable for their investment purposes amid changing market conditions.”
But Korea Investment & Securities is far from alone in riding this ETF wave. Kiwoom Asset Management has also been making headlines. According to Yonhap Infomax, as of February 26, 2026, the net assets of Kiwoom’s ETF lineup surpassed 6.1 trillion won—a leap of over 1 trillion won in just four months since breaking the 5 trillion won mark in October 2025. The momentum is especially strong among ETFs tracking Korea’s main stock indices, fueled by government policies aimed at capital market activation and a growing trend among companies to reward shareholders more generously.
Kiwoom’s differentiated product lineup has played a crucial role in this ascent. In 2025, the company introduced several new ETFs, including “KIWOOM Korea High Dividend & US AI Tech,” “KIWOOM US S&P500 & Dividend Dow Jones Weight Shift,” and “KIWOOM US S&P500 & GOLD.” These products offer everything from structural dividend growth strategies to lifecycle-based automatic rebalancing, and even risk management by allocating 10% to gold. “ETFs have become a major investment vehicle in the current bullish phase of the domestic stock market,” said Lee Kyung-jun, head of Kiwoom’s ETF management division, adding, “We will continue to operate based on investor trust, adapting to changes in the market environment.”
Meanwhile, global index giant MSCI is also deepening its footprint in the ETF ecosystem. According to Simply Wall St, MSCI posted robust results in the fourth quarter of 2025 and has been busy rolling out AI-powered data tools, renewing its long-term ETF contract with BlackRock through 2035, and forging new partnerships with Allfunds and the New York Stock Exchange to bolster its role in investment data and index infrastructure. These moves are part of a broader strategy to embed data and analytics more deeply into client workflows and potentially strengthen recurring revenue streams.
MSCI’s ambitions are bold: the company projects $3.8 billion in revenue and $1.6 billion in profit by 2028, requiring an annual sales growth of 8.5% and a modest uptick in profits from the current $1.2 billion. The company’s fair value is estimated at $679.56 per share, about 19% above its current market price. However, the analysis notes that while AI and index-centered partnerships are promising, the balance between asset-based ETF fees and ongoing pricing pressures in the data and analytics sector remains delicate. The extension of the BlackRock ETF contract is seen as particularly timely, given the importance of asset-based fee income for MSCI in the short- to mid-term.
Back in Korea, the ETF boom is sparking fierce competition among domestic asset managers. According to Sisajournal-e, 2026 has seen major players ramp up their active ETF lineups in earnest. The reason? The lion’s share of demand for domestic passive ETFs has been flowing into Samsung Asset Management’s KODEX ETF suite, largely due to the surging stock market led by heavyweights Samsung Electronics and SK Hynix. To differentiate themselves, other large asset managers are betting on active ETFs as their next big play.
Hanwha Asset Management, for example, is preparing to launch three new active ETFs: PLUS KOSDAQ150 Active, PLUS K-Manufacturing Core Companies Active, and PLUS Global Copyright Core Companies Active. This follows a string of recent launches, including a global humanoid robot active ETF in 2025 and a US high-dividend stock active ETF in January 2026. Mirae Asset Global Investments is set to release its “TIGER Technology Transfer Bio Active ETF” in March, marking its first domestic equity active ETF in over two years. Other firms like Shinhan Asset Management and KB Asset Management have also debuted new active ETFs in January 2026, further intensifying the competition.
Active ETFs, compared to their passive counterparts, typically command higher fees—often exceeding 1% annually. This is attractive to asset managers, especially since the passive ETF market is locked in a brutal price war. Adding to the appeal, the government is expected to soon lift the requirement that active ETFs track at least 70% of their benchmark index, giving managers more flexibility in portfolio construction and potentially boosting growth prospects. However, there’s a catch: finding skilled managers for active ETFs is proving difficult. As one financial industry insider told Sisajournal-e, “Most talented active managers work at specialized private equity funds, and it’s not easy for large asset managers to meet their salary expectations.”
This surge in active ETF launches is not just about market share—it’s also about adapting to the unique characteristics of Korean investors. Unlike their American counterparts, Korean retail investors tend to favor short-term trading and sector rotation, making actively managed products particularly appealing. Firms like Timefolio Asset Management and Samsung Active Asset Management are leveraging this trend to boost their brand recognition through new active ETF offerings.
All told, the Korean ETF market is at a crossroads, shaped by digital innovation, surging investor demand, and a strategic shift toward more actively managed products. As asset managers race to keep up and global players like MSCI deepen their involvement, investors will be watching closely to see which strategies deliver the best returns in this fast-moving arena.
The next chapter in Korea’s ETF story promises to be anything but dull, with technology, regulation, and investor behavior all playing decisive roles in shaping the market’s future.