During Stock Market Corrections, 'KB Stable Dividend ETF'

[Asia Economy Reporter Junho Hwang] KB Asset Management recommended the KBSTAR US Fixed Dividend Preferred Securities ICE TR ETF as a stock pick during the market correction period on the 14th.

Launched in May last year, the KBSTAR US Fixed Dividend Preferred Securities ICE TR ETF tracks the ICE Core Plus Fixed Rate Preferred Securities Index. This index is based on approximately 180 US fixed dividend preferred stocks.

Fixed dividend preferred stocks differ from typical preferred stocks in that they are assigned credit ratings like bonds and have fixed dividends at the time of issuance. They offer an expected dividend yield of over 4% annually, making them popular among investors who prefer stable returns.

Additionally, during market correction periods, they exhibit strong downside rigidity and show more stable returns compared to other products. As of the 8th, the yield since the beginning of the year is 10.8%, outperforming the market yield by more than 3 percentage points during the same period.

Geum Jeongseop, Head of ETF Strategy at KB Asset Management, stated, "This product is a total return (TR) product that reinvests all fixed dividends of the investment target stocks, pursuing compound interest effects and also enjoying tax deferral benefits. It will be a stable and efficient investment destination in a market environment characterized by ultra-low interest rates and high volatility." However, he cautioned that dividend yields may vary due to stock price and interest rate fluctuations, increasing volatility, and actual returns may differ depending on the USD-KRW exchange rate fluctuations.

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