이 기사는 2020년 01월 16일 08:00 thebell 에 표출된 기사입니다.

“His investment philosophy is more like Peter Lynch, with his fascination with stocks and enthusiasm about company site visits. He is a very talented portfolio manager who has strength in a bottom-up analysis” Lee Chai-won, CEO of Korea Value Asset Management, said about Choi Woong-pil, one of his former junior colleagues and now Managing Director of KB Asset Management, the fourth largest asset manager in South Korea.

Lee’s comment makes sense given similarities between Choi and the legendary Wall Street value investor, who was the former portfolio manager of one of the best-known U.S. mutual funds, Fidelity Magellan. Like Peter Lynch made a killing on Dunkin’ Donuts stock because he bought coffee and donuts there every morning, Choi also made many successful investments based on ideas he got from everyday life.

For example, impressed by performances of artists who belong to South Korea’s SM Entertainment, Choi bought shares of the company in 2009. At the time, its market cap was at mere 60 billion won ($51 million), but grew more than sixteen-fold to one trillion won ($862 million) when he sold SM shares three years later. He also picked Joy City, the country’s game company, because he himself had great interest in games. Joy City stock soared from less than 5,000 won ($4.32) per share in early 2010 to above 40,000 won ($34.53) in 2011.

“Choi is different from typical value investors. Most value investors prefer companies that have relatively lower price-to-book ratios but with plenty of cash resources, which in general belong to traditional industries,” one of Choi’s acquaintances said. “But he is more interested in B2C (business to consumer) companies that allow people to experience products in their life.”

After graduating from Yonsei University, the 48-year old started his career at Hyundai Merchant Marine, the country's shipping firm, in 1988. But less than a year later, he changed his career to finance, moving to Dongwon Securities. He met Lee there, who led him to the world of value investing. “Having learned value investing from Lee was one of the best things in my life,” said Choi in an interview with media.

The year of 2009 marked another turning point for Choi, as he decided to move from Korea Value Asset Management, where he worked together with Lee, to his current employer, KB Asset Management.

Choi is considered a strong believer of value investing philosophy, focusing on stocks undervalued compared to their intrinsic value as well as companies that are cheaper than their growth rate. “He has a strong confidence in his stock picks and is not easily swayed,” said an industry insider.

KB Value Focus Fund with great success

Choi has made himself known as one of the country’s top portfolio managers with KB Value Focus Fund, which was launched in 2009. A year after the launch, it topped domestic stock funds in returns. Last December, on its 10th year anniversary, the fund recorded a cumulative return of 115.89 percent and its assets stood at 523.6 billion won ($452 million).

In 2011, Choi inherited one of KB Asset Management’s flagship retirement fund products, which was launched in 2006. This product invests up to 40 percent in stocks and the rest in bonds, where he was responsible for equity portfolio. Last November, the fund recorded a cumulative return of 81 percent, with assets growing to more than one trillion won ($862 million).

Choi was also named as manager of KB SMID Cap Focus Fund launched in 2011 with a focus on attractively priced small and mid-cap value companies in the country. In 2012, the fund recorded the highest annual return of 34.23 percent among domestic stock funds.

With the success of its value funds, KB Asset Management has become one of the top value-investing firms in the country, along with Korea Value Asset Management and Shinyoung Asset Management. Taking credit for his works, Choi was named chief investment officer (CIO) for equity investments in 2015.

But KB Value Focus Fund’s annual return sharply dropped to -4.41 percent in 2016, when domestic value stocks generally underperformed relative to the market as outflows from value funds dominated. It was for the first time that the fund recorded a negative annual return.

In the same year, Choi stepped down his position as CIO and assumed his prior role of head of value equity to lead the team in taking the setback as an opportunity to turn over a new leaf. Since then, he has continued to search for a breakthrough as market conditions have not been reversed in favor of value stocks. Especially over the last two years, he also took an activist approach with some companies, adding to existing value strategies.

(By reporter Lee Hyo-beom)