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| Employees of Global X, Mirae Asset's subsidiary managing exchange-traded funds in the U.S. / Courtesy of Mirae Asset Global Investments |
By Yoon Ja-young
Despite the deteriorating economic outlook worldwide, Mirae Asset's global business has proven its competitiveness especially in times of crisis.
The total assets under management (AUM) of Mirae Asset Global Investments stand at 248 trillion won ($200 billion) as of the end of 2022. Forty percent of them, or 103 trillion won worth, are managed overseas. Despite the global economic crisis triggered last year by a series of negative factors such as inflation, key rate hikes and Russia's invasion of Ukraine, the Korean asset manager had slightly more assets managed overseas than in 2021 when the figure stood at 102 trillion won, reflecting its competence in the global market.
This year marks the 20th anniversary since Mirae Asset's advancement into the global market, when it was the first to do so. It took its first step into the global market in 2003, launching its Hong Kong operation. The industry had an overall negative outlook on Mirae Asset's move, doubting it would be competitive against global big names such as Goldman Sachs and Merrill Lynch. However, Mirae Asset maintained its long-term vision for the overseas market, growing into a noteworthy global player, competitive enough to acquire an exchange-traded fund (ETF) management firm overseas with its global earnings.
ETFs are leading Mirae Asset's global business in markets around the world, including the U.S., Canada and Hong Kong. Global X, its subsidiary managing ETFs in the U.S., is one example. In 2018, Mirae Asset Global Investments acquired Global X, which was getting attention as a rising star in the U.S., which takes up around 70 percent of the global ETF market. Global X ETF was operating around 8 trillion won at the time of acquisition, but the figure grew nearly six times to 45 trillion won as of the end of 2022. Horizons ETFs, Mirae Asset's subsidiary acquired in 2011 to manage ETFs in Canada, is also expanding, currently operating around 21 trillion won.
Thanks to its global network, Mirae Asset Global Investments' overseas operations have accumulated 74.7 billion won in earnings as of the end of the third quarter last year. That is equal to around 30 percent of its total earnings. It compares with other local asset management firms, which make most of their money from the Korean market.
Based on the achievement, Mirae Asset Global Investments and Global X jointly acquired ETF Securities, an Australian ETF management firm. Ranked seventh in the Australian ETF market, it has diverse ETFs worth around 4 trillion won themed on innovative growth.
Mirae Asset's success comes from its courageousness. While advancement into overseas markets guarantees nothing despite high costs, Mirae Asset Financial Group Chairman Park Hyun-joo has emphasized that it can build up experience even if it fails.
ETF Securities changed its name to Global X Australia, creating synergy with Global X to increase its share in the Australian ETF market as well as the pension market.
Mirae Asset is also eyeing emerging markets. Its Indian operation, established in 2006, is currently India's only independent foreign asset manager. While most of other global asset management firms withdrew from the Indian market or transformed into joint ventures, Mirae Asset continued investing in India, betting on its growth potential. The Indian operation currently designs and operates funds on its own to sell to local customers. It has grown into the ninth-biggest asset manager in India. The Indian entity also established a branch in Dubai, the United Arab Emirates.
"We have been expanding our global network for the past 20 years since advancing into the Hong Kong market in 2003. We will concentrate our efforts in search of premium assets around the world, to provide more competitive financial products to our customers," a spokesperson for Mirae Asset Global Investments said.
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