[도약! 한국증시]① Limitations of individual direct investment theory focused on single hits… Public offering funds need to revive

Input 2021.01.01 05:45

Public offering fund sales balance decreases to a quarter in 10 years
Fees and fees need to be lowered by expanding online sales channels
It is also necessary to reduce the tax burden for long-term stock investors.

Last year, the KOSPI index broke through the corona pandemic and stepped on the 2800 hill for the first time in history. Since 2011, the stock market, which had been trapped in the box zone, went up and down the 1800-2600 line and exceeded 2800, the role of an individual investor called’Donghak ant’ played a big role. Domestic and foreign securities companies such as JPMorgan also forecast that the stock market will easily cross the 3000 line in 2021. However, there are many obstacles to overcome in order for the stock market to steadily upward in the long term. Individual investors expected a bullish market and paid debts, and the funds entered into the stock market exceeded 19 trillion won, and stocks in which these funds were invested could be sold in large quantities through counter-trading even if the stock price drops a little. We will look into a series of ways the stock market can steadily rise. [편집자주]

“This year, a lot of individuals have entered the stock market, and if the fund market revitalization policy is added, the market will accept it more positively. It is difficult for individual investors to raise the KOSPI index just by doing stocks, and the fund will strengthen its strength. It must be added.”

Oh Tae-dong NH Investment & Securities (005940)The head of the Research Center said that vitalization of the fund market will be an important key to opening the era of 3000 KOSPI in 2021. Even though the KOSPI index exceeded the 2800 line for the first time in history even in the worst case of the corona pandemic, the stock market stably and steadily even for funds that have not played a major role in the domestic stock market, such as indirect investment funds for the era of’three thousand pi (KOSPI 3000)’ It is an analysis that it should be introduced into the market.

If the short-term investment-oriented market called’Danta’ continues as it is now, the stock market capital flows in and falls like a low tide. In this investment environment, although the KOSPI index can exceed 3000 in the short term, there is a risk of a plunge again in the long term. In fact, the KOSPI has always been trapped in the box between 1800 and 2600 lines since 2011.

Many experts stress that in order to settle the KOSPI 3000, more funds from public offering funds must be introduced into the stock market. Public offering funds are operated by collecting funds from 50 or more investors, and are differentiated from private equity funds that only attract up to 49 investors. Private equity funds mainly invest in alternative assets such as real estate, while public equity funds invest in traditional financial investment products such as stocks and bonds.

According to the Financial Investment Association, as of the end of last year, the amount invested in the public offering fund was 22.3 trillion won. The level is similar to 232.930.8 billion won at the end of 2008 when the global financial crisis occurred. It means that the investment scale has not changed significantly over the past 12 years. During the same period, private equity investments increased more than three times from 126 trillion 556.4 billion won to 412 trillion 4090 billion won.

Among public offering funds, the amount of funds flowing into the stock market declined more rapidly. According to the Korea Capital Markets Institute, the investment of equity-type funds (public offering funds that mainly invested in stocks) among public offering funds at the end of 2009 was 107 trillion won, but at the end of 2019, it fell 73% to 28,9974 billion won. In the financial investment industry, there is a story that “the public offering fund market is completely dead.”

Kwon Min-kyung, a research fellow at the Capital Market Research Institute, points out that the practice of managers deducting high sales commissions and remuneration from banks and other vendors to sell public offering funds is the reason investors hesitate to put funds into public offering funds. This is because if the seller removes high sales commissions and fees, the share of the fund to investors is reduced by that much even if the fund makes a profit. Research Fellow Kwon said, “If the commission and remuneration are set low, the bank, which is the seller, does not sell public offering funds, so high commissions and remuneration have to be paid, and as a result, the structure in which investors lose money is fixed.”

Professor Yoon Sun-joong of the Department of Business Administration at Dongguk University also said, “Does individual investors have or trust in the financial company that sells the fund? It is the most important thing, but many do not trust it.” It seems to be moving to investment.”

In fact, according to Morningstar, a global independent investment research, the sales commission and remuneration ratio that domestic investors should pay is 1.89% (as of 2019), in major countries such as the US (0.59%), Australia (1.23%), and Japan (1.31%). Higher than The reason why financial companies (sellers) are widely recognized as taking away a large portion of their fund’s profits is because of these high selling costs.

In the financial investment industry, the practice of refusing to sell if major sellers such as KB, Woori, Hana, and Shinhan Bank already dominate offline sales channels and do not pay more commissions and remunerations is more expensive than other countries. Point out that this is the reason for creating the practice.

In the asset management industry, an alternative method is suggested by managers to sell public offering funds directly without going through a vendor to improve this problem. Selling funds through online channels rather than relying on offline branches can return higher returns to investors without commissions and fees.

Kiwoom Asset Management’s’Kiwoom Smart 4th Industrial Revolution ETF Split Purchase’ fund launched in February was sold only through Kakao Pay, an online application (app), but the fund’s net asset exceeded 100 billion won on the 9th, 11 months after its launch. After setting up the fund, the return rate is 30.79% (28 days).

Hae-Hyun Park, Managing Director of Mirae Asset Asset Management, said, “The environment for buying and selling funds through online mobile apps is coming. Many managers will challenge direct sales from next year to create a structure that does not depend on sellers and provide investors with funds without selling costs. It is only by reinforcing the efforts provided to restore investor confidence in the public offering fund market.”

There is also a strong voice that the government should reduce the tax burden on long-term investors so that they can invest in the stock market for a long time. In the case of holding stocks for a long period of more than one year for direct investors as well as indirect investment stock funds, short-term investment-oriented domestic stock markets can grow only when taxes are reduced.

Earlier, the government overturned its position on the capital gains tax on equity funds, confusing investors. On June 25, the Ministry of Strategy and Finance announced the draft tax law amendment bill for 2021 and announced a policy of withholding a 20% transfer tax from 2022 if there is any profit from the trade.

In the meantime, domestic equity fund investors have not paid taxes on gains from stock trading, and have paid dividend and interest income tax (15.4% per year) only on interest from stock dividends or bonds that make up a part of the fund. It was to change this and impose a transfer tax.

However, the controversy that such a policy will destroy the stock-type fund market has been dated. He said he would impose a tax of 20-25% only on excess of 10,000 won. However, there is no way to encourage long-term investment as there is no distinction between long-term investors and short-term investors for stock investment capital gains tax.

In the’Economic Policy Direction’ announced on the 17th, the Ministry of Science and Technology announced that it will review plans to revitalize long-term investments such as tax support when holding long-term stocks in order to mitigate the short-term situation of commercial funds.

Research Fellow Minkyung Kwon said, “A lot of fund investors (indirect investments) want to redeem funds in order to realize profits when the stock market rises, and managers also think that it is natural that money is lost from the fund. Deductions will have the effect of reducing such redemption funds.”

“There are many voices wanting special tax benefits for stock investment funds,” said Yoon Sun-joong, professor of business administration at Dongguk University, but it is difficult to provide such benefits because social consensus is difficult. “It is difficult to establish an institutional system, but more active discussion is needed. “I said.