The Korea Investment Corporation (KIC), which manages a $200 billion state fund, announced plans to increase investments in emerging companies in Silicon Valley. The most promising areas in focus are those related to the metaverse and artificial intelligence. Last year, metaverse-linked stocks were also some of the best performing in the country.
Technology companies are viewed by the fund’s management as alternative assets because they pose significant risks – especially after the U.S. Federal Reserve’s interest rate hike. The same category includes investments in the hotel business, which, according to Seoungho Jin, the new head of the CIC, has a chance of an active recovery when the pandemic is over.
By 2025, he believes, such assets will account for about 25% of the portfolio, up from 17% last year. By the same time, the fund’s assets could increase to $300 billion. This is a realistic plan as over the past five years, the size of the fund has doubled.
This year, the share of alternative assets of the CIC may grow by 2 percentage points. The corporation plans to expand its staff in San Francisco, which will deepen its study of the investment market in the high-tech, healthcare and environmental sectors.
South Korea follows the path of a growing list of countries that are looking to seize potential billion or trillion dollar opportunities related to the metaverse.