Samsung Electronics and SK Hynix have posted double-digit declines over the past month, but exchange-traded funds (ETFs) that blend these stocks with bonds have demonstrated strong loss-mitigation capabilities during the correction. Analysts say bonds’ role as a safe-haven asset nearly halved portfolio losses amid heightened market volatility.<\/p>\n
According to the Korea Exchange on July 13, Samsung Electronics’ share price tumbled 14.88% between June 12 and July 13. In contrast, the “KODEX Samsung Electronics Bond Mix” ETF \u2014 which holds roughly 30% in Samsung Electronics and 70% in government and public bonds \u2014 fell only 4.31%. The product’s structure, blending a single stock with bonds to reduce volatility, saw bonds’ defensive characteristics play a key role in curbing portfolio losses during the downturn.<\/p>\n
SK Hynix also dropped 12.18% over the same period, but the “KODEX Samsung SK Hynix Bond Mix 50” \u2014 which allocates 25% each to Samsung Electronics and SK Hynix, with 50% in South Korean government bonds maturing within five years \u2014 limited its decline to 6.13%. The loss-mitigation effect was even more pronounced from an investor’s perspective. For example, if an investor had directly purchased \u20a95 million (approximately $3,346) each of Samsung Electronics and SK Hynix with \u20a910 million (approximately $6,692), the combined value would have fallen to approximately \u20a98.65 million (approximately $5,787), a loss of about \u20a91.35 million (approximately $903). However, investing the same amount in the KODEX Samsung SK Hynix Bond Mix 50 would have resulted in a valuation of \u20a99.39 million (approximately $6,282), limiting the loss to roughly \u20a9610,000 (approximately $408) \u2014 reducing the loss by about \u20a9740,000 (approximately $495) compared to direct stock investment.<\/p>\n
Index-tracking products showed a similar pattern. The “RISE 200 Bond Mix 50,” which holds 50% in the KOSPI 200 index and 50% in domestic bonds, fell 6.21% over the same period. This was roughly half the 11.98% plunge of the “RISE 200,” which tracks the same index.<\/p>\n
The one-month decline comparison for key ETFs is as follows:<\/p>\n
Product1-Month DeclineSamsung Electronics (Individual Stock)-14.88%SK Hynix (Individual Stock)-12.18%KODEX Samsung Electronics Bond Mix-4.31%KODEX Samsung SK Hynix Bond Mix 50-6.13%RISE 200-11.98%RISE 200 Bond Mix 50-6.21%<\/p>\n
Market experts note that bonds’ role in cushioning portfolio losses has highlighted the defensive strength of bond-mix ETFs during the recent volatile market. An additional practical advantage is that the asset manager handles bond selection and rebalancing, reducing the management burden compared to individual investors directly blending stocks and bonds.<\/p>\n
Han Yong-hee, an analyst at Growth Research, highlighted the utility of these products within pension accounts. Since bond-mix ETFs are classified as safe assets under pension rules, they can be a particularly useful tool for aggressive investors. “Rather than investing the 30% safe-asset allocation solely in deposits or bonds, investing it in a bond-mix ETF with a 50% equity weighting allows an investor to allocate up to 85% of their pension account to risk assets,” Han explained.<\/p>\n
However, a clear limitation is that bond-mix ETFs offer capped returns during rallies. With equity exposure at half or less, their upside during surges in underlying assets like Samsung Electronics or SK Hynix is inevitably smaller than individual stocks or pure equity ETFs. Indeed, comparing year-to-date returns, Samsung Electronics’ share price has surged 112.26%, while the KODEX Samsung Electronics Bond Mix has risen only 27.1%. Ultimately, downside protection in bear markets and limited upside elasticity in bull markets are two sides of the same coin.<\/p>\n","protected":false},"excerpt":{"rendered":"Samsung Electronics and SK Hynix have posted double-digit declines over the past month, but exchange-traded funds (ETFs) that…\n","protected":false},"author":2,"featured_media":84845,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[18],"tags":[45218,45217,45214,45215,337,5169,45216,127,276,275],"class_list":["post-84844","post","type-post","status-publish","format-standard","has-post-thumbnail","category-samsung-electronics","tag-growth-research","tag-han-yong-hee","tag-kodex-samsung-electronics-bond-mix","tag-kodex-samsung-sk-hynix-bond-mix-50","tag-korea-exchange","tag-kospi-200","tag-rise-200-bond-mix-50","tag-samsung","tag-samsung-electronics","tag-sk-hynix"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts\/84844","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/comments?post=84844"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts\/84844\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/media\/84845"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/media?parent=84844"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/categories?post=84844"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/tags?post=84844"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}