South Korea’s main pension fund took a 182 trillion won hit after a decline in stakes of equities including Samsung Electronics Co. and SK Hynix Inc.
The estimated value of the National Pension Service stakes of 5% or more in 287 listed companies fell to 333.53 trillion won as of Oct. 15 from 515.93 trillion won at the end of June, according to financial data provider FnGuide. It was the first quarterly decline since the fourth quarter of 2024, based on NPS’s past performance, and marks a dramatic reversal for a fund that posted record-breaking returns in the first half.
The reversal underscores the vulnerability of one of the world’s largest pension funds to swings in its home market, where its enormous holdings in chipmakers Samsung Electronics and SK Hynix leave it particularly exposed to the boom-and-bust cycle in technology stocks.
The decline contrasts sharply with NPS’s performance in the first half, when it reported a 27.2% return, its best performance for the period since at least 2022. The NPS had 1,866 trillion won under management at of the end of June.
The NPS was not available for an immediate comment.
The fund raised its year-end target allocation to Korean equities in May while lowering its target exposure to foreign equities, increasing its planned exposure to a market that has been one of the world’s best performers in the first half.
SK Hynix accounted for the largest decline, with the value of NPS’s holdings in the chipmaker falling by about 74.2 trillion won. Its Samsung Electronics holdings lost about 56.9 trillion won in value. The two stocks accounted for about 72% of the total decline.
Korean stocks have been whipsawed in recent months amid the introduction of single-stock leveraged ETFs and mounting questions over the sustainability of the artificial intelligence-driven rally. South Korea’s Kospi index hit a record closing high of 9,114.55 on June 22, before falling about 39% by Oct. 15. NPS’s stake in SK Hynix declined to 7.32% from 7.5%, while its stake in Samsung Electronics remained unchanged at 7.84%.
The market decline has also drawn NPS into a political debate over whether the pension giant should do more to cushion sharp swings in Korean equities.
The opposition People Power Party has criticized the NPS for failing to act as a market stabilizer during the recent selloff, arguing that its decision to suspend rebalancing earlier this year left it with less room to buy stocks as the market fell.
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