Secondary Battery ETF Returns Diverge by 45 Percentage Points… All-Solid-State Batteries Drive the Gap [ETF vs ETF]

As expectations for all-solid-state batteries grow, performance has diverged among secondary battery ETFs (Exchange-Traded Funds). ETFs that focus on investing in companies related to all-solid-state batteries have posted returns exceeding 30% since the beginning of the year, while secondary battery leverage ETFs and battery materials, components, and equipment ETFs have recorded negative returns.

According to KOSCOM’s ETF Check on the 8th, among 13 domestic secondary battery ETFs (excluding inverse ETFs), the ETF with the highest return since the beginning of the year (with dividends reinvested, as of the 6th) is the ‘SOL All-Solid-State Battery & Silicon Anode Material,’ which recorded a return of 36.92%.

Its return is 45.24 percentage points higher than that of the KODEX Secondary Battery Industry Leverage ETF, which recorded -8.32% over the same period.

The SOL All-Solid-State Battery & Silicon Anode Material has not only posted the best return among secondary battery ETFs since the beginning of the year, but also leads in 1-month (return of 18.01%), 3-month (19.99%), and 1-year (60.90%) returns.

This ETF is a product that focuses on investing in value chain companies related to domestic all-solid-state batteries and silicon anode materials, holding stocks such as EcoPro BM, LG Energy Solution, Samsung SDI, and Isu Specialty Chemicals. In particular, the ETF’s return was driven by a sharp surge following news that Isu Specialty Chemicals will begin full-scale production of lithium sulfide, a key raw material for all-solid-state batteries, starting this month. As of the previous day, Isu Specialty Chemicals had surged 42.23% since the beginning of the year.

An official from Shinhan Asset Management analyzed, “Expectations that core materials for all-solid-state batteries will move beyond supplying test samples to full-scale commercial production are positively affecting investor sentiment.” The official added, “Since stable supply of core materials forms the foundation supporting full-scale battery production, the future growth potential of companies that first secure production and supply capabilities is drawing attention.”

In addition, other top-performing ETFs since the beginning of the year include ‘RISE Secondary Battery TOP 10’ (26.75%), ‘TIGER Secondary Battery TOP 10’ (23.63%), ‘TIGER Secondary Battery Theme’ (18.92%), and ‘KODEX Secondary Battery Industry’ (15.11%). These ETFs also have high allocations to LG Energy Solution and Samsung SDI.

Another product focusing on companies related to all-solid-state batteries, the ‘KODEX All-Solid-State Battery ESS TOP 2 Plus,’ has posted solid returns despite having been listed for less than four months. It recorded 1-month and 3-month returns of 13.41% and 16.19%, respectively. This ETF also holds stocks such as LG Energy Solution, Samsung SDI, Isu Specialty Chemicals, and Daeju Electronics Materials.

On the other hand, ‘RISE Battery Lisa Cycling’ (5.10%), ‘KODEX Secondary Battery Core Materials 10’ (4.14%), ‘TIGER Secondary Battery Material Fn’ (0.80%), and ‘SOL 2Cha Jeon-ji-so (Director)Fn’ (-0.10%) recorded relatively low returns. This is because the stock prices of POSCO Holdings, POSCO Future M, and other companies included in these ETFs fell due to the impact of declining lithium prices.

Jang Jung-hoon, a researcher at Samsung Securities, explained, “Secondary battery component stocks and cathode material stocks, which rose the most last August, all turned downward last month.” He added, “In particular, Lisa Cycling stocks fell sharply last month due to concerns over Lisa Cycling profitability following a sharp drop in lithium carbonate prices.”