NPS at Crossroads: KOSPI Rally Past 500 Trillion Won
May 17, 2026 — The National Pension Service (NPS) of South Korea, one of the world's largest pension funds with 1,800 trillion won ($1.2 trillion) in assets under management, faces a pivotal decision on May 28, 2026. The fund's medium-term asset allocation plan for 2027–2031 will be finalized amid intensifying pressure from a domestic equity rally that has pushed the NPS's actual Korean stock holdings to approximately 27% of its portfolio — nearly double its 14.9% target allocation. I've been following NPS asset allocation decisions since the 2023 strategic review, and this moment — with domestic equity holdings crossing 500 trillion won — is the most consequential portfolio decision the fund has faced in a decade. My view is that the NPS board is caught between two uncomfortable truths: selling into a rally risks capping the KOSPI's upside, but failing to rebalance leaves the fund dangerously concentrated in a single asset class at cycle highs. ...