Hanwha Asset Management Launches Two ESG Active ETFs

[Asia Economy Reporter Junho Hwang] Hanwha Asset Management simultaneously listed 'ARIRANG ESG Value Stock Active Exchange-Traded Fund (ARIRANG ESG Value Stock Active)' and 'ARIRANG ESG Growth Stock Active Exchange-Traded Fund (ARIRANG ESG Growth Stock Active)' on the 2nd.

These products combine ESG investment with the characteristics of active ETFs. For both products, more than 70% of the portfolio tracks the benchmark index, while the remaining less than 30% is managed by Hanwha Asset Management's Strategic Equity Management Team, which adjusts investment weights and stocks aiming to achieve excess returns compared to the benchmark index.

Both products build portfolios by discovering companies expected to improve ESG scores and companies with excellent ESG performance based on company-specific ESG scoring produced by a dedicated ESG organization. In addition to non-financial ESG factors, value and growth-related indicators derived from financial factors are also considered to determine investment stocks and weights. Changes in stocks and weights occur twice a year, on the option expiration dates in July and December.

'ARIRANG ESG Value Stock Active' includes stocks whose current prices are cheap compared to the company's liquidation value, and stocks whose prices are cheap relative to current earnings and cash flow. Among ESG factors, governance (G) scores are prioritized. Top holdings include Samsung C&T, Korea Zinc, Dongwha Enterprise, KT, Korean Air, and NAVER.

'ARIRANG ESG Growth Stock Active' invests in companies with a high probability of maintaining growth in the future, companies that continuously invest in R&D, and companies sufficiently equipped with conditions necessary for corporate operations. Among ESG factors, environmental (E) scores are prioritized. Top holdings include LG Electronics, Samsung SDI, Hyundai Motor, Zinus, Soulbrain, and Oscotec.

Yu-bi, head of Hanwha Asset Management's Strategic Equity Management Team, said, "We will continue to collaborate with the internal ESG dedicated team to advance Hanwha Asset Management's proprietary evaluation model," adding, "We will apply the ESG scores derived through this process to portfolio construction."

Nam Yong-su, head of Hanwha Asset Management's ETF Management Team, said, "I believe that combining the financial part representing a company's core business and management results with the future intangible value of ESG scores will consistently deliver stable and good performance," and added, "ESG is currently the hottest topic in the industry, and ESG investment will continue to increase. Also, in the long term, we must consider that ESG can be fully established in the investment process."

This content was produced with the assistance of AI translation services.