Why Korean investors are piling into China robotics ETFs
While Korean companies de-risk from China, investors see its manufacturing dominance as key to humanoid robotics boom
As Korean companies try to reduce exposure to China amid rising geopolitical tensions, Korean retail investors are doing the opposite — increasing their bets on China’s humanoid robotics industry.
The contrast highlights a widening gap between corporate strategy and investor sentiment, as many investors see China’s dominance in manufacturing and supply chains as a key advantage in the emerging robotics economy.
Humanoid robotics has quickly become one of the most closely watched technology battlegrounds, with global players racing to develop machines capable of performing human tasks. The competition includes projects such as Tesla’s Optimus robot and Hyundai Motor Group’s Atlas platform, fueling expectations that humanoid robots could evolve into the next major industrial ecosystem after electric vehicles.
South Korean investors are increasingly positioning themselves for that future through exchange-traded funds tied to China’s robotics supply chain.
According to the Korea Exchange, seven ETFs listed in Korea track the humanoid robotics industry — two focused on Korean companies, two on the United States, two on China and one covering global firms.
Assets tracking China and Korea are nearly level, with 652 billion won ($444 million) and 683 billion won, respectively, both significantly higher than the 423 billion won invested in US-focused robotics funds.
The flows reflect a growing belief that China’s strength in manufacturing and component supply could translate into leadership in humanoid robotics.
“Although the humanoid robotics industry is still in its early stages, the ecosystem is increasingly forming around China,” said Lee Jong-min, team manager of ETF Management Team 2 at Mirae Asset Global Investments.
Lee said the sector’s supply chains are beginning to resemble those of the electric vehicle industry, where China has already established global dominance.
“As seen in solar panels, drones and EVs, China tends to achieve large-scale commercialization quickly by leveraging supply chain strength and cost competitiveness,” he said. “That advantage could allow the country to expand its global market share in humanoid robotics as well.”
Reflecting that outlook, Mirae Asset launched the Tiger China Humanoid Robot ETF last May to capture companies across China’s robotics ecosystem, ranging from motors and sensors to actuators and control systems.
Major holdings include collaborative robot developer Shenzhen Dobot, humanoid robotics company UBTech Robotics and electric vehicle maker XPeng, which is also developing humanoid robot technologies.
Another product listed in Korea is Samsung Asset Management’s Kodex China Humanoid Robot ETF, which tracks the Solactive China Humanoid Robotics Index, covering companies involved in robotics development, motion control systems and automation technologies.
Over the past six months, the Tiger China Humanoid Robot ETF gained 9.58 percent, outperforming its domestic rival, which recorded a 0.5 percent loss.
Both funds, however, lagged US-focused robotics ETFs, which rose between 15 percent and 30 percent, as well as a global robotics ETF that gained roughly 60 percent over the same period.
Despite the performance gap, analysts say exposure to China remains attractive because many of the industry’s most critical components are produced there.
“Many key suppliers of motors, actuators and rare earth materials are based in China, creating choke points in the global robotics supply chain,” Lee said. “Even companies like Tesla are not free from those dependencies.”
For investors, that supply-chain dominance may prove more important than identifying which company ultimately wins the humanoid robotics race.
“In such an early-stage industry, technological shifts can quickly reshape the competitive landscape,” Lee said. “It may be wiser to invest in the broader ecosystem rather than trying to predict the success of individual companies.”
Some analysts also point to valuation gaps in China’s equity market.
While the US economy’s gross domestic product is estimated at around $30 trillion in 2025, compared with roughly $20 trillion for China, the gap in stock market valuations remains far wider.
That disparity suggests Chinese equities may have room for a global re-rating, creating opportunities for investors willing to accept geopolitical risk.
“China faces risks from intensifying strategic rivalry with the US,” said a market analyst specializing in Chinese equities. “But those risks can be managed through portfolio allocation, leaving significant long-term investment potential.”
silverstar@heraldcorp.com
