Portfolio & Risk
Portfolio & Risk Management
IPO-related investments carry different kinds of risk and different exit timelines at each stage. BNB Asset Management combines strategies to suit each fund and mandate, has limits set by committees, and has investment and compliance staff cross-check before and after every trade. How we build a portfolio is how we manage its risk.
Strategy Mix
A strategy mix with the IPO at its core
With the IPO at the centre, BNB also uses pre-IPO, post-IPO, listed-company mezzanine, SPAC and fund-of-funds strategies according to the nature of each fund and mandate. As of 13 October 2026, all 17 funds listed on our website include IPOs in their main strategy.
The mix and weighting of strategies are set within the limits of each fund’s rules and each mandate, and differ from fund to fund.
- Pre-IPO Before listing · uncertain exit timing
- Post-IPO After listing · while market valuation settles
- Listed mezzanine CB · BW · EB · issuer credit and conversion terms
- SPAC Merger completion · structure of escrowed funds
- FoF Fund of funds · underlying liquidity and fees
Risk by Strategy
Different risks, different timelines
Even within the IPO field, the nature of risk and the time it takes to exit vary by stage and instrument. We look at each separately and combine them to suit the fund or mandate.
| Strategy | Main risks | Liquidity & exit | What we check before investing |
|---|---|---|---|
| Pre-IPO | Listing delayed or cancelled | Disposal can take time before listing, and holdings may be subject to lock-up after listing. | Likelihood of meeting listing requirements; how to exit if listing is cancelled |
| IPO shares | Uncertain allocations; early price volatility after listing | Shares committed to a lock-up cannot be sold during that period. | Pricing rationale, valuation against peers, shares that may trade right after listing |
| Post-IPO | Price swings while market valuation settles | Traded on the secondary market; free float may rise when lock-ups expire. | First post-listing results; lock-up expiry schedule |
| Listed mezzanine | Deterioration in the issuer’s credit | Privately placed securities can be hard to sell when desired. | Financial stability and repayment capacity; conversion and exercise price adjustments; put terms |
| SPAC | Merger not completed; price moves after the merger | If no merger is completed within the set period, the SPAC dissolves and returns escrowed funds to shareholders. | Trading price versus escrowed funds; the merger target and merger ratio |
| FoF | Results of the underlying funds | Affected by the redemption terms and liquidity of the underlying funds. | Underlying strategies, managers and risk controls; fees charged at two levels |
This summarises our IPO Strategy and Principles pages from a portfolio perspective. The items actually reviewed may differ depending on the fund or mandate.
Limits & Committees
Committees set the limits; systems check them before trading
Portfolio limits are not set by the investment team alone. Three committees separately deliberate on asset allocation and limits, risk management and asset valuation, and the limits they set are checked in the trading system through pre-compliance before any order.
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Investment Committee
Investment Review Committee
Sets fund-level and firm-wide asset allocation strategy and limits by asset. Approves amendments to asset management rules and exceptions.
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Risk Committee
Risk Management Working Committee
Reviews risk policy and risk standards, and decides on grace and follow-up measures when risk limits are breached. New products such as new funds undergo a prior risk review.
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Valuation Committee
Fund Asset Valuation Committee
Sets fair-value methods for assets without a market price, such as pre-IPO shares, and safeguards the independence and consistency of valuation.
- 01Limits set by committees
- 02Pre-compliance rules in the system
- 03Trade execution
- 04Real-time monitoring
- 05Post-trade review & internal audit
Cross-Check
Three points where investment and compliance meet
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Pre-trade
Before investing
The Compliance Team checks suitability and compliance with laws and internal rules in advance. Pre-compliance items entered in the trading system screen out limit breaches.
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At trade
At the time of trading
We monitor in real time that funds stay within risk limits. When several funds acquire the same asset, results are allocated fairly according to an allocation statement fixed before the order.
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Post-trade
After investing
We continuously review the value of holdings and confirm implementation through post-trade monitoring and regular internal audits.
The Compliance Officer also serves as Chief Risk Officer (CRO) and manages risk independently of the investment organisation.
Loss & Exit Discipline
Losses and exits are planned in advance
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Loss-cut principle
A loss-cut principle limits how far losses on individual holdings can grow. Any exception requires review by the Risk Management Working Committee.
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Scenario-based trading plans
Before investing, we set trading plans for the period right after listing, for lock-up expiry and for when events unfold differently than expected.
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Liquidity checks
Periods when sales are restricted by lock-up commitments, and assets that take time to sell, are considered at the decision stage. Matters relating to deferral of redemptions, such as when fund assets become impaired, are reviewed by committee.
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Crisis response
When a risk event occurs, we act on scenario-based plans with the aim of resolving it the same day, then identify causes and set guidelines to prevent recurrence. A business continuity plan (BCP) is in place for market shocks.
Fiduciary Duty
Our fiduciary responsibility: voting rights and stewardship
Voting rights attached to shares held in a fund are exercised by the manager in the interests of investors. BNB participates in the Korea Stewardship Code and publishes its implementation plan for each principle.
- 01Our basic principle is to exercise voting rights with investors’ interests first.
- 02We maintain voting guidelines and may refer to the views of external proxy advisers where needed, but final decisions are our own responsibility.
- 03We record and manage our voting and stewardship activities and may report them to investors.
- 04Where a potential conflict of interest is identified, we inform the investors concerned in advance and take the steps needed to protect them before proceeding.
Important information
- This page is a general description of how we build portfolios and manage risk, and is not a solicitation to invest in any product.
- Risk management is a framework for managing the possibility of loss; it does not guarantee principal or returns. Past performance does not guarantee future returns.
- Our funds are general private funds open only to qualified investors. Collective investment securities are not protected under the Depositor Protection Act.
