Still, the KPOP ETF faces challenges.
“Thematic ETFs are ever coming up with narrower and creative slices of investment strategies,” said Henry Jim, ETF analyst at Bloomberg Intelligence. “Although KPOP stands out in its clear focus on one industry in one country, they will have an uphill battle in reaching a target market that’s difficult to define. I fear they may be left with only ‘individual fans’ as a limited addressable target market.”
The KPOP ETF is designed for retail investors and investment professionals who believe in Korean entertainment businesses, according to Lee.
Established in 2020, Contents Technologies builds and invests in intellectual properties as well as businesses related to technology, finance and services within the content value chain. The KPOP ETF is the company’s first fund. Exchange Traded Concepts is the investment adviser while Moorgate Benchmarks is the index administrator of the new ETF.
“We are interested in opening up additional ETFs that echo our focus in the Asian content market,” Lee said. “But as of now, we do want to very much focus on and keep up with one of the biggest identities of Korea and Asia. We hope to make this pretty successful before we go on to the next one.”