CLIENT SERVICES IN PRIME BROKERAGE: The Rise of Tailored Support
A Shift in the Prime Brokerage Relationship
Prime brokerage has long provided essential infrastructure for hedge funds and family offices. But over the past several years, the expectations around that relationship have changed.
What was once a transactional service—execution, custody, margin—is now expected to be a strategic partnership, built around the client’s individual needs. More firms, particularly newer launches and sophisticated family offices, are asking: “What does it look like when my prime broker actually understands my book, my risk tolerance, my strategy, and my growth path?”
That shift is not theoretical—it is currently reshaping how services are delivered across the industry.
From Standardization to Customization
No two hedge funds are identical. Quant strategies, credit funds, long/short equity, macro—each has distinct financing, operational, and reporting needs. Yet for years, prime brokerage services tended to offer relatively standardized solutions.
That’s changing. Increasingly, clients expect: – Custom financing structures – margin methodologies and short financing that reflect strategy-specific needs – Flexible operational setups – integrations with fund-specific tech stacks, customized reporting, or unique settlement flows – Support across asset classes and geographies – not just execution, but seamless clearing and custody across global markets
Where once clients might have adapted to their prime’s systems, they now expect the reverse: bespoke services built around them.
The Role of Responsiveness
Customization isn’t just about infrastructure—it’s also about people.
What many hedge funds value most today isn’t a slick portal, but rather a responsive relationship. Someone who actually answers the phone as well as someone who knows the fund’s structure and can escalate a margin issue quickly or troubleshoot a corporate action anomaly before it becomes a problem.
This is especially true for emerging managers, who may lean on their prime for guidance beyond trade execution; but it also holds true for established funds, who expect prompt, proactive communication when navigating complex, high-volume trades or operational challenges.
Beyond the Core: Value-Added Services
Today’s prime brokerage often includes a broader ecosystem of support. For funds looking for more than the basics, the industry increasingly offers: – Capital introduction – particularly useful for emerging managers or those building new mandates – Outsourced trading desks – to augment execution capabilities without building a full in-house desk – Tailored securities lending – especially for strategies with complex shorting needs – Risk analytics and transparency tools – real-time portfolio insights, margin modeling, or custom dashboards – Operational consulting – from launch planning to best practices in reconciliations, NAV oversight, or compliance workflows
None of these are new concepts. What’s new is the expectation that they be modular, flexible, and available if—and when—the client wants them.
Global Platforms, Boutique Service
One trend across the industry is the attempt to strike a balance: combining the reach and stability of a global platform with the attentiveness and flexibility of a boutique.
For clients, the ideal partner tends to be one that can scale with them—across markets, asset classes, and fund structures—without sacrificing the high-touch experience they expect.
Some firms, like Mirae Asset, have leaned into this model: building infrastructure that spans markets across North America, Europe, and Asia, while structuring their client services teams to provide on-the-ground, relationship-based support.
What Clients Are Asking For
In conversations across the industry, several recurring themes stand out among hedge fund and family office clients seeking prime brokerage services:
1. “Will they really prioritize me?” In a world where some large banks are selectively offboarding, clients want to know they’re not an afterthought.
2. “How responsive are they?” Especially during volatility or month-end crunches, delays can become costly.
3. “Can they handle my complexity?” Whether it’s a multi-strategy structure or a launch across multiple domiciles, cookie-cutter setups won’t cut it.
4. “Do they know how to help me grow?” Prime brokerage is increasingly seen as part of the growth infrastructure—not just a middleman for trades.
Final Thoughts: Choosing the Right Fit
There is no universal blueprint for the ideal prime brokerage relationship. But for many hedge funds and family offices, the calculus has shifted and capabilities matter, as does balance sheet. As well as customization, availability, and trust.
Prime brokerage, at its best, is not just about trades—it is about partnership. As the industry moves toward more flexible, client-driven models, managers have more options than ever to find a partner aligned to their vision, complexity, and ambition.
THE FED'S NEXT MOVE: Hedged Messaging, Data Crosscurrents, and the Rates Dilemma
The Federal Reserve, led by Chair Jerome Powell, continues to embody its reputation as a hedged institution. Officials frequently deliver mixed signals to preserve flexibility. In May, Powell described the U.S. economic situation as "very uncertain," refusing to commit to a policy direction:
“It’s not at all clear what the appropriate response for monetary policy is at this time.”
This cautious posture is deliberate—but also familiar. The Fed is not just hedged; it's historically reactive. With dual mandates grounded in lagging indicators—inflation and employment—the institution tends to wait until data is undeniable before pivoting. Its moves are rarely anticipatory. Instead, the Fed waits until markets, jobs, and price levels force its hand. As a result, it often arrives late to both the inflation fight and the growth rescue.
That institutional design explains today’s ambiguous communication. With inflation ticking up due to tariffs and growth indicators turning cloudy, Powell and colleagues are standing still—carefully watching the data, but unwilling to get in front of it.
Split Messaging: Competing Fed Narratives
Some Fed officials are sounding alarms. Fed Governor Adriana Kugler stressed the need to keep rates high for “some time” to combat inflation. St. Louis Fed President Alberto Musalem argued that new tariffs and immigration constraints could stall disinflation and necessitate a more restrictive policy path.
Others are more dovish. Atlanta Fed President Raphael Bostic expects two cuts in 2025, while Chicago’s Austan Goolsbee highlighted the progress already made on inflation, urging patience and caution.
These divergences are not accidental. They’re part of the Fed’s long-standing strategy of hedging—floating a range of interpretations while avoiding commitment. Powell regularly returns to the same refrain: they are “data dependent.” What that really means: we’re not going to act until the data makes the decision for us.
Inflation: Solved—Until It Wasn’t
Headline and core inflation cooled into early 2025, with core PCE hitting 2.3% in March. Powell even acknowledged inflation “appeared solved.” But the Trump administration’s surprise tariffs have flipped that narrative. Goldman Sachs estimates these import taxes could add up to 2.25 percentage points to core inflation by early 2026.
The Fed now faces a textbook stagflation dilemma: rising costs due to trade barriers paired with slower demand. It’s the type of exogenous shock that blurs the policy path—and ensures the Fed does nothing until outcomes become clear.
Labor Market: Still Resilient, But Cooling
The unemployment rate has crept up to 4.2%, from the post-pandemic low of 3.4%. April’s jobs report showed 177,000 new payrolls—steady, but down from last year’s pace. Beneath the surface, softness is emerging: job losses in Q1 2025 totaled nearly 500,000, particularly in goods-producing sectors.
For now, Fed officials characterize the labor market as “healthy but cooling.” That buys them time. But if job losses continue to mount or unemployment pushes beyond 5%, a shift in posture becomes more likely. Still, true to form, the Fed is unlikely to lead that pivot. They’ll react when it’s confirmed—not anticipate it.
Growth: The Economy Hits a Speed Bump
After a 2.4% expansion in Q4 2024, GDP contracted 0.3% in Q1 2025. Consumer spending slowed, and confidence dropped to levels not seen since early 2020. Businesses pulled back investment amid tariff uncertainty. Yet Powell was quick to call this a "bump," not a turning point.
This is typical Fed behavior: don’t overreact to noise. But the risk is that by the time the Fed distinguishes signal from noise, the economy has moved on—usually in the wrong direction.
Tariffs: A Supply Shock in Motion
Powell called the new tariffs “significantly larger than anticipated.” The Fed sees them as a stagflationary supply shock—raising prices while damping growth. Officials are watching for second-round effects in consumer prices and inflation expectations.
But once again, don’t expect preemptive action. The Fed is waiting to see how it plays out in the data—months from now. That’s the paradox: the Fed can’t respond until it's already too late to avoid some damage.
Reaction Thresholds: What Forces a Move
Despite all the ambiguity, the Fed appears to be anchoring around two soft thresholds:
- Inflation: If core inflation clearly trends toward 2%, rate cuts are likely. But persistent readings above 2.5%—especially with rising expectations—could force hawkish patience.
- Unemployment: A sustained move above mid-4% levels, especially with broad-based job losses, could tip the balance toward easing. The Fed’s own March SEP forecast unemployment at 4.1% by year-end; a meaningful overshoot would be tough to ignore.
But again, the Fed is not predictive. They’ll wait for clear and confirmed trends before moving. That often means policy arrives after the inflection point—not before.
Markets and Sell-Side Forecasts: Divergence Widens
Markets are pricing in one to two cuts by late 2025, with futures implying easing in Q3 or Q4. Sell-side shops are split:
- Goldman Sachs expects three cuts (July, September, November), citing recession risk from tariffs.
- J.P. Morgan expects one or two cuts in H2 2025, contingent on inflation cooperating.
- Morgan Stanley says no cuts until 2026 if inflation proves sticky.
These forecasts mirror the Fed’s own internal split. More importantly, December Fed Funds futures now price ~40 bps below the Fed’s median dot plot, signaling that markets expect the Fed to eventually fold—even if Powell isn’t ready to say so.
Treasury Yields and the Debt Wall
The Fed’s room to maneuver is further constrained by Treasury market dynamics.
Roughly $9.2 trillion in U.S. debt matures in 2025—about 30% of GDP. Add another $1.9 trillion in projected deficit issuance, and you’re staring at $10–11 trillion in total refinancing.
Yields reflect that pressure:
- 3-month bills: ~4.3%
- 2-year: ~4.0%
- 10-year: ~4.5%
- 30-year: ~5.0%
The front of the curve is inverted, but long rates remain elevated as investors demand compensation for duration, inflation risk, and supply indigestion.
So far, auctions have held up. But Treasury’s interest expense is exploding: $950 billion in FY2025, likely $1 trillion+ in 2026. While the Fed doesn’t explicitly manage Treasury funding costs, they can’t ignore the consequences. If yields spike further or auctions falter, the Fed could halt QT—or, if markets seize, step in more directly.
Conclusion: Wait for the Obvious
The Fed’s next move remains elusive—and that’s by design. Powell and his colleagues won’t pre-empt anything. Instead, they’ll wait until the data paints a clear and inescapable picture. That means confirmation of inflation falling to target or meaningful damage in the labor market.
Until then, we’re in limbo: no hikes, no cuts, just data watching. That leaves markets to price probabilities and guess which threshold will break first.
For now, the Fed’s reputation as a trailing institution holds. It will not act until it must—and by then, the market may already be two steps ahead.
FUNDING PRESSURES ARE BACK: What it means for hedge funds and the prime brokerage landscape
After years of low-cost leverage, equity financing costs are back in the spotlight—and not in a good way for most market participants. Borrowing costs to short equities have jumped, and stock loan rates are materially higher than they were even a year ago. Many prime brokers are increasingly steering clients toward equity swaps as an alternative, which introduces its own pricing complexities. Whether funds are using margin, swaps, or borrowing stock directly, the reality is the same: financing has gotten more expensive.
This matters, especially for small and mid-sized hedge funds and family offices. Higher funding costs eat directly into returns, making previously profitable strategies less compelling. For long/short equity funds in particular, this environment demands a re-evaluation of financing arrangements and a closer look at prime brokerage relationships.
A New Cost of Doing Business
Financing costs are the invisible tax on leverage. When hedge funds short equities or trade through swaps, they're effectively renting balance sheet from their prime broker. That rental cost—a combination of the risk-free rate, a borrow fee, and an added spread—has climbed significantly.
In theory, higher spreads should normalize as markets stabilize. But this time, that isn't happening. Even after recent volatility brought equities lower, funding costs have stayed stubbornly high. Research from JPMorgan shows that financing costs remain in the top quintile of the past five years.
The persistence of these elevated levels suggests structural, not cyclical, forces are at play.
Demand Is High. Supply Is Constrained.
The first piece of the puzzle is demand. A wave of systematic and derivatives-based strategies has increased the need for leverage and stock borrow. Long/short equity funds, quant strategies, and macro portfolios are all competing for a limited pool of prime brokerage capacity.
But the real story is on the supply side. Major banks—still the dominant providers of equity financing—are constrained. Post-crisis regulations, particularly Basel III and the Supplementary Leverage Ratio (SLR), have forced banks to ration their balance sheets.
This matters because when a bank extends leverage or lends hard-to-borrow stock, it has to reserve capital against that exposure. As bank balance sheets fill up, equity financing becomes a more scarce and expensive commodity.
In today’s environment, that scarcity is showing. Traditional prime brokers are less willing or able to provide balance sheet at scale—and when they do, it comes at a premium. Many banks are also pushing clients toward equity swaps, which allow them to manage balance sheet exposure more efficiently—but often with less transparency and less favorable economics for the client.
Why It Hurts Smaller Funds More
The current dynamic disproportionately impacts small and mid-sized hedge funds. Large multi- manager platforms and the biggest global macro funds still command balance sheet access, albeit at higher prices. But smaller funds—those running a few hundred million or less—are often left with take-it-or-leave-it pricing, inflexible margin terms, or reduced access altogether.
This trend isn't new, but it's becoming more pronounced. Several of the bulge-bracket banks have made clear they are focusing prime brokerage resources on their largest clients. That leaves emerging managers and family offices caught in the middle: needing leverage to stay competitive, but increasingly priced out of efficient access to it.
The result? Reduced capital efficiency, narrower strategy spreads, and more time spent managing financing logistics instead of generating alpha.
A Market Opportunity, If You Have the Capital
There is a flip side to this imbalance. For cash-rich entities or firms with large, unconstrained balance sheets, these dislocations are attractive. Higher stock borrow costs and wider swap spreads open up arbitrage opportunities—such as facilitating short positions for others or entering into synthetic financing trades.
Pension funds, sovereign wealth funds, and large asset managers are stepping in to provide financing directly or indirectly, capturing the elevated spread that banks can’t efficiently intermediate.
Some hedge funds have adapted by deploying their own balance sheet where possible, or by reducing reliance on traditional PB services. Others are looking beyond the bulge bracket for better terms.
The Prime Brokerage Model Is Shifting
This environment is reshaping the prime brokerage industry. The historical dominance of a few global banks is being challenged not just by cost, but by structural constraints. In their place, asset managers, non-bank dealers, and boutique primes are expanding their role.
Crucially, the ability to commit balance sheet has become the differentiator. Execution services and technology matter, but in a world where stock borrow and swap financing can vary by 50 to 100 basis points depending on your provider, balance sheet is king.
Hedge funds that proactively revisit their financing relationships are finding opportunities to reduce drag, improve flexibility, and secure more durable terms. That might mean diversifying across providers, engaging with newer entrants, or negotiating more bespoke terms.
Looking Ahead
It’s unclear whether elevated funding costs are the new normal or just a temporary dislocation. But either way, hedge funds and family offices can't afford to ignore the shift.
In a high-rate, balance-sheet-constrained world, prime brokerage is no longer a commoditized service. Major banks are selectively allocating their balance sheet to the largest and most profitable clients, often leaving smaller funds with limited access, higher costs, or less favorable terms. It's a strategic input. Managers that treat it as such—and partner with providers who have both the willingness and ability to extend balance sheet—will be better positioned to compete.
For funds navigating this environment, the message is clear: financing is no longer a back-office detail. It’s a front-office priority.
HYOSUNG TO DOUBLE TRANSFORMER OUTPUT TO CONQUER US MARKET
The US transformer-making unit of South Korea’s Hyosung Heavy eyes over 10% share of the US market within two years
By Woo-Sub Kim Mar 03, 2025
Hyosung HICO plant in Memphis, Tennessee (Courtesy of Hyosung HICO)
MEMPHIS, Tenn. -- South Korea’s major power system and machinery conglomerate Hyosung Heavy Industries Corp. plans to nearly double its annual transformer output in the US to over 250 units in two years, gearing up for a surge in transformer demand during the artificial intelligence boom.
Hyosung HICO Ltd., Hyosung Heavy Industries’ transformer-manufacturing operation in the US, plans to ramp up the annual transformer production capacity of its plant in Memphis, Tennessee, to more than 250 units – from the current 130 – before 2027. In the first phase, it will expand the capacity by 53.5% to 200 units by early 2026, and then over 250 in the following year, which would cost the company hundreds of billions of Korean won (hundreds of millions of US dollars) in total. After it completes the plant’s capacity expansion, Hyosung HICO is expected to command more than a 10% share in the US transformer market versus last year’s 6%, said Jason E. Neal, president of Hyosung HICO. Neal projects that Hyosung’s transformer sales and output in the US would beat those of the market’s current top two, Siemens and General Electric (GE), within two years to become the largest US transformer producer and seller. His confidence lies in the company’s huge five-year transformer order backlog, driven by strong replacement demand for aging power equipment and installation demand from AI-driven new data centers set to spring up across the US.
A 525-kV transformer in Hyosung HICO plant
TRANSFORMER DEMAND WILL REMAIN HIGH FOR A WHILE
A transformer is an essential part of an electrical system as it changes the voltage level of electricity produced by power plants for the efficient transmission of electrical energy. The cost to build each unit ranges from 6 billion to 20 billion won ($14 million). Hyosung HICO is the only US producer of 765-kilovolt (kV) transformers, which cost about 20 billion won per unit. The company has recently bagged an order to manufacture the ultra-high-voltage transformer from one of the top five US utility companies. Hyosung moved much faster than its competitors in making bold investments to develop ultra-high-voltage transformers while others hesitated, said Hyosung HICO president.
The company’s transformers are highly sought after by its customers in the US, where it has been supplying them to US utility companies since 1999. Hyosung is expected to win more transformer orders in the US.
Workers in Hyosung HICO's plant in Memphis, Tenn. The US government under President Donald Trump has decided to simultaneously build more liquefied natural gas (LNG), renewable energy and nuclear power plants to cope with mounting electricity demand from data centers powering AI. Transformers are required to run power plants and data centers. Further, over 70% of the US electricity grids are more than 25 years old, meaning that the demand to replace old transformers with new ones is set to increase further in the next decade. Encouraged by the rosy outlook, Hyosung's cross-town rival HD Hyundai Electric Co. also announced a plan earlier this year to invest about half of its 2024 operating profit, estimated at 720 billion won, to bump up its transformer output at its US plant in Alabama to 150 units a year from the current 100.
NO TARIFFS
Hyosung is poised to win more transformer orders in the US without worrying about tariffs thanks to its transformer plant in Tennessee. 
Hyosung's ultra-high-voltage transformer. Hyosung acquired the Memphis plant from Japan’s Mitsubishi Electric Power Products for $45 million in 2020 to avoid heavy tariffs the first Trump administration threatened to impose on imports. The brave investment has proved to be a stroke of genius.
Driven by the increasing price of transformers on their high demand, Hyosung Heavy Industries’ operating profit hit its historic high of 362.5 billion won in 2024, and this year’s profit is forecast to exceed 500 billion won, according to market analysts. Its operating profit in 2020 stood at 44.1 billion won. Backed by the strong demand for transformers, Hyosung plans to transform its Memphis plant into a place where it can produce not only transformers but also other power equipment such as industrial circuit breakers and static synchronous compensators (statcom) to beef up profitability, the company said.
Mirae Asset rises to 12th-largest ETF manager with $141 billion in assets
Its growth in Asia is noteworthy, with its Indian unit expanding the fastest among its global affiliates
South Korea’s leading asset manager Mirae Asset Financial Group has emerged as the world’s 12th-largest exchange-traded fund (ETF) manager with over 200 trillion won ($141 billion) in net asset value (NAV). According to Mirae Asset Securities Co.'s overseas asset management affiliate Mirae Asset Global Investments Co. on Wednesday, the group operates 624 ETFs managing $141 billion across 13 countries as of the end of November. Mirae Asset doubled its ETF assets in just three years. In 2021, it managed 100 trillion won in NAV globally. The company attributed its rapid growth to its aggressive mergers and acquisitions strategy, through which it has established a broad global network.
Mirae Asset entered the ETF market in 2006 under the leadership of Chairman Park Hyeon Joo, launching ETF products under the TIGER brand in Korea. As of the end of November, TIGER ETFs held a 36% market share in the domestic ETF market.
Park, founder and chairman of the group, assumed the group’s global investment and strategy officer (GISO) role in 2018 to lead Mirae Asset’s global expansion.
AGGRESSIVE M&As
Park has pushed the investment firm’s global expansion through M&As. Under his leadership, Mirae Asset Global Investments acquired Canada’s Horizons ETFs in 2011, which was rebranded as Global X Investments Canada Inc.
Global X Canada has become the fourth-largest ETF manager in the country, with a focus on income-generating ETFs that periodically pay out cash. In 2018, the company acquired the US-based Global X ETFs for $488 million. Global X ETFs, known for its strength in thematic ETFs, has seen a fivefold rise in assets under management since then.
Mirae Asset also bought Sydney-based ETF Securities, which accounts for 4% of Australia’s ETF market, for 120 billion won ($95.2 million) and later rebranded it as Global X ETFs Australia.
Last year, Mirae Asset bought the UK’s leading ETF manager Goldenberg Hehmeyer LLP (GHCO) for $35 million to step up its ETF services in Europe, the world’s second-largest after the US.
RAPID GROWTH IN INDIA
Mirae Asset's growth in Asia is noteworthy. It established Mirae Asset Global Investments’ first global affiliate in Hong Kong in December 2003. In 2011, it became the first Korean asset management firm to list an ETF on the Hong Kong Stock Exchange. Mirae Asset has also established Global X Japan, a joint venture with Daiwa Securities, in 2019.
Mirae Asset’s Indian subsidiary is one of its fastest-growing affiliates worldwide. Mirae Asset Securities established its India operations in 2018 – Korea’s first brokerage to do so in the country.
Mirae Asset continues to blaze trail in global investments
기자명 Tim Kim Published 2025.02.03 15:29
Korean financial giant vows to keep forging ahead in overseas markets
Pictured is Four Seasons Hotel Sydney, which is owned by South Korean financial conglomerate Mirae Asset Group. [Photo courtesy of Mirae Asset Group]
South Korea’s Mirae Asset Group noted on Feb. 3 that the financial conglomerate would continue to blaze a trail in global investments down the road. The Seoul-based outfit vows to keep finding alternative investment opportunities as part of efforts to become a global investment bank like Goldman Sachs and JP Morgan. When it comes to alternative investments, Mirae Asset has been second to none among Korean competitors and is regarded as one of the top Asian players. Now, the entity hopes to forge a path to become a world-class leader. For instance, Mirae Asset has taken over such prestigious hotels as the Four Seasons and Fairmont.
In addition, the corporation has made strategic investments in many innovative firms, including SpaceX and X, which is formerly known as Twitter.
Most recently, Mirae Asset launched Mirae Asset Sharekhan in India, with a bold vision to become one of the country’s top five brokerage houses within five years. The growth of the group is underpinned by its two representative subsidiaries of Mirae Asset Securities and Mirae Asset Global Investments.
The former is a top-tier brokerage in the South Korean market with the country’s largest equity capital. The latter manages the nation’s biggest Nasdaq 100 ETF under the TIGER brand.
Mirae Asset founding Chairman Park Hyeon-joo now serves as the group’s Global Strategy Officer. [Photo below courtesy of Mirae Asset Group]
Visionary leader
Observers point out that the exponential growth of Mirae Asset Group has been boosted by its visionary founding Chairman Park Hyeon-joo, who also works as the entity’s Global Strategy Officer. Under the stewardship of Chairman Park, Mirae Asset has been proactive in diversifying portfolios, mitigating market volatility, and hedging against inflation, which are the features of global top IBs. The results have been impressive.
For instance, the Four Seasons Sydney, purchased in Sept. 2013, has appreciated by 79.3 percent and is now valued at about AUD 610 million ($375 million) as of Sept. 2024.
Similarly, the Fairmont Orchid in Hawaii, acquired in May 2015, has increased in value by 68.9 percent, reaching an estimated $ 380 million.
Given the complexities of valuing alternative assets compared to traditional stocks and bonds, Mirae Asset claims that the firm’s successful investments in this sector amply demonstrate its expertise and strategic acumen as a global IB.
Since 2022, the company has invested more than 800 billion won ($550 million) in such high-tech firms as SpaceX, X, and AI startup xAI.
As of Nov. 2023, the valuations of these investments had increased by around 1.5 times, with expectations for further growth, according to Mirae Asset.
M&A strategy for global expansion
Watchers pick Mirae Asset’s aggressive approach to mergers and acquisitions (M&A) as a key driver of its global competitiveness. Chairman Park is famous for having long championed the idea that Korean firms should create national wealth by expanding overseas and entering global markets through bold M&A activities. Currently serving as the Global Strategy Officer, he continues to oversee significant M&As and equity investments.
Driven by his strategic vision and commitment to expansion, Mirae Asset has made several crucial acquisitions over the past several years to strengthen its global presence.
In 2018, the company gobbled up Global X, a leading U.S.-based thematic ETF provider. This was followed by the acquisition of Global X Australia in 2022 and Australian robo-advisor Stockspot in 2023. Plus, Mirae Asset acquired GHCO, a European ETF market-making specialist. In India, the corporation completed the purchase of Sharekhan late last year to launch Mirae Asset Sharekahn in the potential-loaded South Asian country. With this acquisition, Mirae Asset expects that its global business will generate an additional 100 billion won ($68 million) in annual profit.
By allocating 40 percent of its equity capital to overseas operations, Mirae Asset projects its global business to chalk up 500 billion won ($340 million) in pre-tax profits beginning in 2027.
Over the past 21 years, Mirae Asset has successfully expanded its international footprint, now operating 47 overseas subsidiaries and offices across 19 regions. “With 21 trillion won ($14 billion) in equity capital and 840 trillion won ($570 billion) in global client assets under management, Mirae Asset has established itself as Asia’s premier investment bank,” a Mirae Asset official said.
“Looking ahead, we are preparing to ascend to the ranks of the world’s top-tier investment banks, continuing our trajectory of innovation, strategic expansion, and long-term value creation.”
Mirae Asset Group strives to establish itself as global investment bank powerhouse
By Lee Yeon-woo Posted : 2025-01-22 16:03
Mirae Asset Group is striving to become a global investment powerhouse under the leadership of its founder, Chairman Park Hyeon-joo, through active investments in global alternative assets and innovative technologies.
Since 2022, the group has invested over 80 billion won ($55.6 million) in SpaceX, X (formerly Twitter) and xAI. These investments have reportedly grown by approximately 1.5 times in market value and are expected to continue increasing. The group has also achieved significant returns from investments in global alternative assets, such as luxury hotels in major tourist destinations. For instance, Four Seasons Hotel Sydney was valued at approximately 610 million Australian dollars ($381.8 million) as of September 2024, marking a 79.3 percent increase since its initial investment in 2013. Similarly, Fairmont Orchid in Hawaii has reached a valuation of 380 million dollars, reflecting a 68.9 percent increase since 2015. Mirae Asset Group is also gaining a competitive edge through bold mergers and acquisitions (M&A). "Korean companies should focus on creating national wealth through overseas operations and actively pursue M&As to establish a strong presence in the global market," Park said.
Under Park’s leadership as global strategy officer, the group has expanded overseas, acquiring key entities such as Global X, a leading U.S. thematic exchange-traded funds (ETFs) provider, Australian asset management firm Global X Australia, Australian robo-advisory company Stockspot and GHCO, a European ETF market-making specialist. As a result, Mirae Asset Group has built the largest global network among Korean financial firms, operating 47 overseas subsidiaries and offices across 19 regions over 21 years of international expansion. "With 21 trillion won in equity capital and 840 trillion won in global client assets, we aim to evolve from Asia’s leading investment bank into a top-tier global investment bank," a Mirae Asset Group official said.
Mirae Asset Management Expands Global Footprint with 27 Overseas Subsidiaries
Mirae Asset Management has significantly expanded its global footprint, as revealed in its 2024 semi-annual report submitted to the Financial Supervisory Service's electronic disclosure system (DART) on August 19. The report highlights that the company now operates 27 overseas subsidiaries in 10 countries, marking an 80% increase in its overseas presence over the past five years.
Mirae Asset Management first ventured into the global market in December 2003 by establishing 'Mirae Asset Management Hong Kong,' becoming the first domestic asset management company to do so. This initial step set the stage for a series of strategic expansions and acquisitions that have solidified its position as a global player in the asset management industry.
In February 2005, the company launched the “Mirae Asset Asia Pacific Star Equity Fund,” the first overseas fund directly managed by a domestic asset management company's overseas subsidiary. This move was followed by the acquisition of Canada's “Horizons ETFs” in 2011, marking the beginning of Mirae Asset's journey to becoming a global ETF management company.
The company's global expansion continued with the acquisition of the United States' “Global X” in 2018 and Australia's “ETF Securities” in 2022. Notably, the acquisition of “ETF Securities” was the first instance where a domestic asset management company acquired an overseas ETF manager with profits earned overseas. Last year, Mirae Asset further diversified its portfolio by acquiring “Stockspot,” an Australian robo-advisor specialist, becoming the first domestic financial group to acquire an overseas robo-advisor specialist.
As of the end of June this year, Mirae Asset Management manages 585 ETFs in 16 countries and regions, including the United States, Vietnam, Brazil, the United Arab Emirates (UAE), the United Kingdom, India, Japan, China, Canada, Colombia, Australia, and Hong Kong. The company's total assets under management (AUM) at the end of the first half of this year stood at 200.9343 trillion won (approximately $148.8 billion), with overseas investment AUM reaching 83.0797 trillion won, surpassing Samsung Asset Management's 69.6577 trillion won.
India hosts the most Mirae Asset Management locations with six subsidiaries, followed by Australia with five, and the United States with four. In comparison, Mirae Asset's overseas bases are 3.4 times more than Samsung Asset Management's and 5.4 times more than Hanwha Asset Management's.
A significant milestone in Mirae Asset's journey was celebrated last June when a congratulatory message for the listing of the “TIGER NASDAQ 100 +15% Premium Ultra-Short ETF” was displayed on the Nasdaq Tower billboard in New York, USA. This event underscored the company's growing influence and recognition in the global financial markets.
Korea’s Mirae Asset to open AI business unit in New York
WealthSpot in the US, Stockspot in Australia, Mirae Asset’s Indian unit to accelerate the group’s AI business expansion worldwide
Mirae Asset Group, the pioneer in South Korea’s mutual fund industry, plans to set up an artificial intelligence business unit in New York as the financial conglomerate aims to expand global investment services with robo-advisors for future growth.
“WealthSpot, Mirae Asset Group’s AI unit, is set to be opened in New York City,” the group founder and Global Strategy Officer Park Hyeon Joo told The Korea Economic Daily in an interview on Tuesday. “We will dispatch core Mirae Asset executives such as Kim Yeon Chu, head of derivatives, to lay the foundation for the business.”
Kim, who is touted as one of the group’s future leaders along with Kim Namki, head of Mirae Asset Global Investments Co.’s exchange-traded fund (ETF) business, has been appointed to head up WealthSpot.
The New York unit is poised to oversee the group’s AI business and handle the robo-advisor sector, global investment asset allocation and ETF development.
Robo-advisors are digital platforms that provide automated, algorithmic investment services with minimal human supervision.
Mirae Asset Securities' Overseas Stock Holdings Increase by Over 10 Trillion Won This Year
Mirae Asset Securities’ balance of foreign stocks has increased by approximately 10 trillion won ($7.32 billion) this year alone. Mirae Asset Securities plans to generate more than 50 percent of its total profits from overseas in the medium to long term.
According to Mirae Asset Securities on August 1, the balance of foreign stocks stood at 33.8 trillion won as of July 11. This figure represents an increase of 10.2 trillion won compared to the end of last year.
Mirae Asset Securities' balance of foreign stocks started at 1 trillion won in January 2017, surpassed 20 trillion won in April 2021, and has continued to grow steadily, exceeding 30 trillion won in June of this year. In 2024 alone, the foreign stock balance increased by 10.2 trillion won, while clients' valuation gains on these foreign stocks rose by approximately 8.7 trillion won during the same period.
Currently, Mirae Asset Securities operates 12 local subsidiaries and three offices abroad, giving it the largest overseas network among the 14 domestic securities firms that have successfully expanded internationally. The company's overseas subsidiaries have a combined capital of about 4.5 trillion won. In 2020, Mirae Asset Securities became the first in the industry to achieve annual pre-tax profits of 200 billion won from overseas operations. In 2021, it set a new record with pre-tax profits of 243.2 billion won, marking two consecutive years of exceeding 200 billion won in pre-tax profits from international ventures.
In particular, Mirae Asset Securities has been aggressively expanding into the Indian market, which has emerged as a “post-China” investment hub, by acquiring a local securities firm last year. The Indian subsidiary of Mirae Asset Securities has surpassed 1.6 million retail customer accounts. Following the launch of the online trading platform “m.Stock” in April 2022, it rose to 9th place among local online brokers and 16th overall within 26 months, establishing itself as the fastest-growing securities firm in India.
The Indian subsidiary handles an average of 2.2 million transactions daily. As of the end of June, it managed approximately 1.06 trillion won in total customer assets under management (AUM) and held around 267.8 billion won in margin trading facility (MTF).