Seoul: The value of South Korea's investment funds rose more than 8 percent in the first quarter of this year from three months earlier, driven by an increase in investment funds traded on stock exchanges, data showed Thursday.

According to Yonhap News Agency, the net asset value of South Korean investment funds reached 1,493.9 trillion won (US$1 trillion) as of the end of March, marking an 8.5 percent increase from three months prior. This growth was primarily fueled by a significant rise in the net assets of exchange-traded funds (ETFs), which soared by 21.4 percent to 360 trillion won during the same period.

The record-high tally of ETFs has been noted since the investment vehicle's introduction to the local stock market in 2002. ETFs are investment funds traded on stock exchanges, investing in a basket of stocks that track an index or commodities and bonds.

The sharp increase in the ETF market is attributed to the sustained capital inflow as investors are attracted to the low brokerage fees and stable returns offered by these funds.