ARIRANG US Tech 10 Leverage iSelect (Synthetic)
ARIRANG US Tech 10 Leverage iSelect (Synthetic) (KRX ticker: 461910) is a Korean-listed overseas leveraged ETF launched by Hanwha Asset Management on July 18, 2023.
It tracks the iSelect US Tech 10 Index with 2x daily leverage, concentrating exclusively on the top 10 US mega-cap technology leaders:
| Microsoft | 20.17% |
| Apple | 18.07% |
| Alphabet (Google) | 15.60% |
| Tesla | 15.25% |
| Amazon | 12.10% |
| NVIDIA | 11.71% |
| Meta Platforms | 8.33% |
| Broadcom | 4.38% |
| Adobe | 2.37% |
| Cisco Systems | 1.80% |
Because it applies 2x daily leverage through swap contracts, its expense ratio is 0.80%, which is higher than standard unleveraged index ETFs.
Unleveraged (1x) alternatives tracking similar top-10 US tech indices on the Korean market include ARIRANG US Tech 10 iSelect (461900), TIGER US Tech TOP10 INDXX (381170), and the covered-call variant TIGER US Tech TOP10 +10% Premium (474220).
Can a Concentrated 2x Big-Tech ETF Outperform 3x TQQQ?
At launch, Hanwha Asset Management highlighted that backtested 5-year returns of the 2x concentrated US Tech 10 strategy outperformed TQQQ (ProShares UltraPro QQQ, which tracks the broader 100-stock Nasdaq-100 index at 3x leverage).
In 5-year historical backtesting, while TQQQ returned 170.59%, ARIRANG US Tech 10 Leverage iSelect recorded a cumulative return of 293.48%.
Over a 1-year window, TQQQ gained 70.39% versus 74.91% for ARIRANG US Tech 10 Leverage, while annualized volatility was lower at 59.99% compared to TQQQ's 72.92%.
Real-World 6-Month Performance Check After Listing
Six months after its July 2023 debut (as of January 19, 2024), US equity markets experienced both a geopolitical pullback in autumn 2023 and a powerful AI semiconductor rally fueled by rate-cut expectations.
Over its first 6 months of live trading, ARIRANG US Tech 10 Leverage iSelect delivered a 25.24% return, outperforming TQQQ's 16.46% over the exact same period.
During market corrections, TQQQ suffered from severe 3x volatility drag with a maximum drawdown (MDD) exceeding -30%, whereas the 2x concentrated Big Tech ETF limited its drawdown to roughly -10%, allowing it to compound more efficiently when AI leaders rebounded.
Even when compared against QLD (ProShares Ultra QQQ, 2x Nasdaq-100), which posted a ~14% gain with a -20% drawdown, focusing purely on the 10 mega-cap AI and cloud winners provided superior risk-adjusted returns during the period.
Conclusion & Tax Efficiency Considerations
For aggressive investors seeking leveraged exposure to US Big Tech, concentrative 2x exposure to the top 10 tech leaders mitigates some of the extreme 3x volatility decay seen in TQQQ during sideways or choppy markets.
Additionally, for Korean retail investors, trading a domestically listed overseas ETF offers potential tax advantages: whereas direct US stock/ETF capital gains above 2.5 million KRW are taxed at 22%, gains in Korean-listed overseas ETFs are taxed at the 15.4% dividend income rate and can be held inside a brokerage-type ISA (Individual Savings Account) for up to 2 million KRW tax-free plus 9.9% low-rate separate taxation.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. All investment decisions and risks rest solely with the investor.