South Korea's stock funds returned nearly 17 percent in the first half of the year as the equity market soared on improving corporate earnings and an economic recovery, a fund evaluator said Wednesday.
The average return of local stock funds with net assets of 1 billion won or more, excluding exchange traded funds, came to 16.9 percent as of Monday, according to KG Zeroin.
In contrast, local bond funds returned an average 0.76 percent in the first half amid greater risk appetite across the world.
Market watchers attributed the stellar performance of the stock funds to the country's roaring stock market.
Despite the bull market and high returns, the stock funds suffered a net outflow of 5.2 trillion won this year on profit-taking, compared with 7.9 trillion won for all of last year.
"With the key index keep renewing highs, investor appetite for profit-taking was very intense, leading to such a huge net outflow," said Oh On-soo, a KB Securities analyst.
He expected local stock funds to register solid returns in the second half of the year as the KOSPI is likely to maintain its upturn for the time being thanks to improving corporate earnings and the undervaluation of local shares. (Yonhap)