ETF Market Insight
Hanwha Asset Management's High Dividend ETF to Increase Monthly Payouts
Hanwha Asset Management has announced that starting in May, it will increase the monthly dividend per share for its 'PLUS High Dividend Stock' ETF from 63 KRW to 73 KRW. This represents a 15.9% growth in dividends, adding to the appeal of this largely popular ETF. As the largest dividend ETF in Korea, this is expected to positively impact retirees and investors seeking regular cash flows. Recent policy changes, including tax rate reductions on dividends, further strengthen the investment merits of Hanwha's high dividend ETF. Such changes are drawing greater interest from investors, as evidenced by continued fund inflows into the PLUS High Dividend ETF. This year, the net asset increased by 223.9 billion KRW, with a total net asset value of 680.3 billion KRW, showcasing its growing popularity. Moreover, Hanwha's PLUS High Dividend ETF has recorded a 19.7% yield over the past year, providing a positive signal to investors concerning performance. The initiative to increase payouts will be well received by investors seeking predictable cash flows and stable asset growth, making it a significant move in the context of enhanced shareholder value and policy reinforcement in the dividend ETF market.
Surge in Popularity of Currency-Hedged ETFs Amidst Exchange Rate Fluctuations
Amid the fluctuating exchange rates, currency-hedged ETF products are gaining traction among investors in the U.S. stock market. Samsung Asset Management's KODEX S&P500(H) and KODEX Nasdaq100(H) ETFs have surpassed a combined net asset value of 1 trillion KRW. This milestone is largely due to their value as an alternative that mitigates foreign exchange risks, especially against the backdrop of increased volatility in the dollar-won exchange rate. These ETFs achieved significant growth within 2 years and 4 months of being listed, with net assets rising by approximately 59.9% this year alone. Individual investor net purchases have reached about 101.7 billion KRW, underscoring their appeal as an attractive investment option for medium- to long-term investors seeking to avoid currency risk. In a situation where the dollar had maintained strength but is experiencing increased volatility, currency-hedged ETFs offer a way to effectively offset general exchange rate risks. The recent depreciation of the dollar-won exchange rate has positively influenced this trend, serving as a strategy to minimize risks associated with conventional currency-dependent investment methods.
Mirae Asset Launches Ultra-Short U.S. Treasury ETF
Mirae Asset Global Investments has announced the launch of its new 'TIGER U.S. Ultra-Short (3 months or less) Treasury' ETF. This fund mirrors BlackRock's 'iShares SGOV ETF' by tracking the same underlying index, focusing on U.S. Treasury bonds with maturities of three months or shorter. Amid the volatile US long-term interest rate environment, these ultra-short treasury bonds are viewed as stable investment vehicles, offering a low total expense ratio of 0.09% annually. Furthermore, this ETF provides monthly dividends and can be traded in Korean Won, eliminating the hassle of currency exchange for Korean investors. The introduction of this ETF allows investors to sidestep foreign currency complexities while engaging with a secure investment option, likely increasing demand. Its competitive expense ratio contributes to its appeal as a cost-effective financial instrument. An inaugural event is anticipated, expected to draw significant investor interest.
Korea Investment Management Launches New ETF Accumulation Fund
Korea Investment Management has launched a new ETF product named 'Korean Income ETF Accumulation Fund'. This fund is designed to assist investors who find direct ETF investment challenging by allowing diversified investments across various ETFs, aiming for stable returns. A significant feature of this fund is its monthly rebalancing that allows it to adapt flexibly to market changes. Each sub-fund utilizes diverse strategies including covered call, high yield, high dividend, and bonds, emphasizing consistency and returns of the portfolio. Investors can choose among four sub-fund options, including a monthly dividend option. The redemption cycle is set at 4 business days, targeting to guide investors more stably through a variety of investment options and low volatility. Currently, subscriptions are available through Korea Investment & Securities, Kyobo Securities, and KB Securities, with an annual management fee set at 0.20%. This new fund presents an attractive option for investors interested in ETFs.
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