[Anchor]

Yesterday, the Kospi closed up 3.7% at 6,598. While it is a significant gain, the index remains nearly 30% lower compared to its peak last June. As the semiconductor rally fizzles out and volatile market conditions persist, investors managing their own retirement pensions are suffering continuous losses.

Here is the report from Lee Tae-gwon.

[Reporter]

Mr. A, an office worker in his 30s, switched his retirement pension to a defined contribution (DC) plan earlier this year, which allows him to manage the funds himself.

He invested about 70 million won of his retirement pension mostly into domestic semiconductor exchange-traded funds (ETFs), but amid the stock market plunge last month, his valuation dropped by 20 million won from the peak.

[Mr. A / Retirement Pension Investor : I put about 70% mostly into semiconductors, focusing on places like Samsung Electronics and SK Hynix. (However, as the market fell), I gave back almost everything....]

Online posts are also continuing to emerge from people who suffered heavy losses after investing their retirement pensions in semiconductor stocks.

Retirement pension accumulations, which surpassed 500 trillion won for the first time late last year, have been on an upward trend, reaching 553 trillion won in the second quarter of this year.

Among these, defined benefit (DB) plans, which companies are responsible for managing, saw a growth rate of just 1% in the second quarter, whereas DC plans surged by 14%.

It is estimated that many people switched to DC plans along with the stock market boom.

An analysis of pension accounts at a major domestic brokerage firm showed that half of the top 10 net-bought stocks from the beginning of this year through last month were domestic semiconductor-related ETFs.

The most heavily purchased ETF was a product mixing Samsung Electronics, SK Hynix, and bonds, which recorded a return of -12.9% last month, with the others also suffering double-digit losses.

[Kim Young-ki / Team Leader, Pension Consulting Department, Korea Investment & Securities : Since domestic semiconductor ETFs are overly concentrated on just two stocks, investing heavily in such high-volatility areas can be disadvantageous in terms of diversification....]

Since retirement timing is fixed, experts advise that an approach like target-date funds (TDFs)—which invest in high-yield assets early in the life cycle and focus more on safe assets as retirement approaches—is necessary.

(Video reporting: Kang Dong-chul, Video editing: Yeojin, VJ: Jeonghan, Design: Lee Jun-ho)