[THE INVESTOR] National Pension Service, the nation’s largest institutional investor, plans to purchase Korean stocks worth 20 trillion won (US$17.80 billion) next year as part of its five-year investment plan unveiled on May 26.

Under the plan, equity investments by the world’s third-largest pension fund in the domestic stock market will increase from the current 18.4 percent to 18.7 percent by the end of 2018, while the total amount will reach 122.6 trillion won. 

Following the news, Korea’s stock market rallied on May 26. The benchmark KOSPI closed at 2,355.80 points, up 1.10 percent from the previous day.

The pension fund said it will also boost its investments in overseas stock markets from 85.6 trillion won to 116.1 trillion won next year, with the portion increasing from 15.3 percent to 17.7 percent.

On the other hand, its overall bond investments will be reduced from the current 54.9 percent of its total investment portfolio to 51.1 percent.

As of the end of 2016, NPS managed 557.7 trillion won in assets. The state-run fund plans to increase its assets to 655.7 trillion by the end of next year.

Its overseas investments will also be boosted from 27 percent last year to 29.3 percent 2018 and 40 percent in 2022.

By Park Ga-young (gypark@heraldcorp.com)