South Korea ETFs have been on a remarkable performance hot streak over the last 12 months. According to ETF Database data, South Korea-specific ETFs have all returned more than 140% over the last twelve months. A 3x South Korea ETF, for example, returned more than 1,000% in that same time frame. Where could 2026 take South Korea ETFs, then, and how might investors use them?
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While they have taken a dip this week amid Iran concern, South Korean equities are still up significantly over most time frames. Prior to the Iran selloff, South Korean equities hit a record high market cap.
They have benefited from investor interest in key tech names like SK Hynix Inc., a major semiconductor producer. Those tech names may have benefitted from investor desire for tech exposure outside the U.S. proper. What’s more, the country’s economy has increasingly become a hub for AI worldwide, as well.
South Korea ETFs have benefitted from those strong numbers. The iShares MSCI South Korea ETF (EWY), for example, has returned 175% over the last 12 months according to ETF Database. It has also produced some robust performance on a YTD basis, returning 51.8%. EWY charges 59 basis points (bps) to track the MSCI Korea 25-50.
The Franklin FTSE South Korea ETF (FLKR) and the Matthews Korea Active ETF (MKOR), too, have performed very well. FLKR has returned 49.4% YTD and MKOR has returned 47.7%. Those ETFs charge 9 bps and 79 bps, respectively, with MKOR taking an active approach to the space. FLKR meanwhile tracks the FTSE South Korea RIC Capped Index.
South Korean equities may not be able to replicate the 100% plus returns they have offered over 12 months. However, their continued provision of AI equities outside the U.S. could continue to make it a space to watch for curious investors.
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