iShares MSCI South Korea Capped Index ETF (IKO) — Review & Analysis

IKO tracks the MSCI Korea 25/50 Index — Korean large- and mid-cap companies with a 25% single-stock cap and 50% combined top-stock cap. AUM is $196.62 million as at May 2026 with a 0.45% p.a. management fee. Compare IKO against broader Asia exposures on our Asia ETF page or use the Compare ETFs tool to put it side-by-side with IAA or VAE.

IKO has been the single best-performing Asia ETF on the ASX over the past year — a +206% one-year return to May 2026, driven by Samsung Electronics, SK Hynix and the broader Korean semiconductor and AI hardware complex. Against IAA (iShares Asia 50, 0.50%) or VAE (Vanguard Asia ex-Japan, 0.40%), IKO trades broader regional diversification for concentrated single-country exposure — and that concentration delivered. The 25/50 cap structure is important: without it, Samsung alone would dominate the index given its weight in the Korean market.

Structurally, Korea is heavily exposed to global tech hardware and memory cycles — IKO is effectively a leveraged play on the AI infrastructure build-out, semiconductor demand and consumer electronics. The flip side is sequence risk: Korea has historically been one of the more volatile single-country emerging markets, with deep drawdowns during global tech corrections.

After a year like this, the question for any new investor is whether they're buying the trend or buying the top. Read our Asia, China & Emerging Markets ETF guide for the broader regional context and how Korea fits inside an Asia allocation.