Park Hyun-sik, Research Team Leader at Hana Bank's Hana The Next Strategy Division, recommended in an interview on the 9th that investors increase allocations to US stocks and bonds for the second half, maintaining currency exposure despite elevated dollar-won exchange rates. Park proposed a portfolio composition of 70% stocks, 15% US bonds, and 15% gold, with US-based investment assets potentially comprising 57% of total holdings. The strategy addresses Korean investors' concerns about entering domestic equities after sharp rallies and dollar assets amid high exchange rates, with Park stating that currency exposure remains valid through year-end given interest rate differentials and structural market dynamics. Hana The Next Strategy Division focuses on asset management for senior clients considering retirement cash flow and wealth preservation across generations.
Hana Bank Recommends 70% Stock, 15% Bond, 15% Gold Portfolio for H2
Park presented a baseline stock allocation of 30% US, 30% Europe and Japan, 30% Korea, and 10% China. He advised that if access to European and Japanese investment products is difficult, investors can shift that allocation to US markets instead. Under this adjustment, US-based investment assets including stocks and bonds would represent 57% of the total portfolio. Park stated, "Statistically, US stock markets have always shown strength in the year following midterm elections. Looking toward next year, if your current US position is zero, you need to start building it now."
US Assets Favored as Growth Industries Remain Concentrated in American Markets
Park explained his preference for US assets stems from the concentration of growth industries in American markets. He noted that semiconductors, artificial intelligence, space, humanoid robots, autonomous driving, and biotechnology sectors are centered in the US. Park stated, "The US is trying to revive even manufacturing on a domestic basis, and major growth industries like space, humanoid robots, autonomous driving, and biotech are still led by the US. If you invest in Nasdaq, even if semiconductors shake, big tech or bio-healthcare can compensate."
Park Sees Limited Probability of Three Rate Cuts This Year
While markets currently anticipate three rate cuts within the year, Park assigns low probability to this scenario. He explained that employment and inflation indicators may temporarily show strength, but this does not constitute structural change sufficient to support the Federal Reserve's tightening decisions. Park stated, "Current US employment appears temporarily favorable due to immigration restriction policies and World Cup effects. As the Iran war also winds down, oil prices stimulating inflation have fallen to the $60 range." He added that if rate hike concerns ease, market attention in stocks could broaden from earnings stocks and semiconductors to growth stocks overall.
Currency Exposure Strategy Preferred Over Hedging Due to 2% Cost
Park assessed that currency exposure strategy remains more effective than hedging from an exchange rate perspective. Given that US interest rates exceed Korean rates, investors must bear hedging costs, making it unnecessary to delay dollar asset investment solely due to high exchange rates. Park stated, "You could hedge currency, but when US rates are higher, you have to pay costs equivalent to the rate differential. I don't see the need to bear costs around 2% for hedging." He emphasized, "Since the dollar-won exchange rate already experienced the 1,600 won level, market tolerance for high exchange rate levels has increased. As the possibility of exchange rates falling significantly by year-end is limited, the strategy of holding US stocks and bonds with currency exposure is better."
Senior Client Investment Principles Emphasize Asset Preservation Over Short-Term Returns
Park emphasized that investors should avoid excessive concentration in specific assets as a principle for second-half asset management. While senior clients' investment interest has broadened with recent stock market strength, he cautioned against approaches that belatedly chase markets driven by FOMO (fear of missing out). Hana The Next is Hana Financial Group's specialized brand handling lifecycle needs of senior clients including retirement planning, asset management, and inheritance. Park stated, "After markets rise, it's easy to be swept up in FOMO, and conversely when markets crash, returning only to deposits can cause you to miss opportunities. Maintaining pre-determined asset allocation principles is important." He emphasized that the core of senior asset management is "not how much you earn, but preserving and using it well over time."
FAQ
What portfolio allocation did Hana Bank recommend for the second half?
Park Hyun-sik from Hana Bank recommended a portfolio composition of 70% stocks, 15% US bonds, and 15% gold. Within the stock allocation, he suggested 30% US, 30% Europe and Japan, 30% Korea, and 10% China as a baseline distribution.
Why does Hana Bank prefer currency exposure over hedging for US assets?
Park stated that currency hedging requires bearing costs equivalent to the US-Korea interest rate differential, approximately 2%. He assessed that since the dollar-won exchange rate already experienced the 1,600 won level and is unlikely to fall significantly by year-end, maintaining currency exposure for US stocks and bonds is the better strategy.
