Samsung Asset Management Launches Korean Version of 'DIVO ETF'

Monthly Distributions Paid Through Stock Dividends and Option Premiums

[Asia Economy Reporter Yoonju Hwang] Samsung Asset Management is launching a Korean version of the popular monthly dividend covered call exchange-traded fund (ETF) 'DIVO' from the U.S. asset manager Amplify. This move is interpreted as an effort to maintain leadership in ETFs amid inflation and rising interest rates.

On the 27th, Samsung Asset Management announced the new listing of the 'Samsung KODEX U.S. Dividend Premium Active ETF.' This product is a high-dividend income ETF that simultaneously pursues high-quality dividend growth stocks and individual stock covered call strategies.

The Samsung KODEX U.S. Dividend Premium Active ETF is the first product launched in Korea through collaboration with Amplify, a U.S. ETF manager whose shares Samsung Asset Management acquired in April this year. Samsung Asset Management expects this new ETF to become a new milestone for the global expansion of KODEX ETFs.

This ETF is a localized version tailored to domestic investors' preferences and investment environment, based on Amplify's flagship mega-hit product, the DIVO ETF (Amplify CWP Enhanced Dividend Income ETF), which has assets under management (AUM) of $1.8 billion.

The DIVO ETF is recognized as a good solution for investors who want to receive steady and stable monthly dividends and is well known among domestic investors investing in the U.S. stock market.

This ETF is a monthly dividend ETF that selects and invests in U.S. high-quality companies that have consistently increased their dividends. It secures a stable dividend source by including representative U.S. high-quality dividend growth stocks such as Visa and Johnson & Johnson, as well as leading growth stocks like Apple and Microsoft.

The KODEX U.S. Dividend Premium Active ETF generates monthly dividend income through two methods: 'dividends received from stocks' and 'premiums from selling call options.' This is known as a covered call strategy. What differentiates this ETF from previous covered call products is that it conducts strategic call option sales on individual stocks.

Since Samsung KODEX U.S. Dividend Premium Active employs a covered call strategy for each holding, the premiums received from selling call options vary by stock. In some cases, instead of taking the option premium, it may strategically pursue gains from market appreciation. In other words, it adds an active strategy that seeks capital gains from stock price increases alongside simply collecting option premiums.

Kim Doo-nam, head of Samsung Asset Management's ETF Business Division, stated, "The Samsung KODEX U.S. Dividend Premium Active ETF is suitable for smart investors who want to secure stable monthly cash flow and also gain profits from the price appreciation of the invested assets."

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