Truston Asset Management Launches TRUSTON Shareholder Value Active ETF

Truston Asset Management, which advocates a new concept of activist funds, is launching 'TRUSTON Shareholder Value Active,' an active exchange-traded fund (ETF) that invests in stocks expected to increase shareholder value through governance improvements, including activist target stocks.

According to Truston Asset Management on the 30th, this ETF, scheduled to be launched next month, primarily invests in companies whose stock prices are significantly undervalued compared to their intrinsic value due to low shareholder return rates, and that ▶have the potential to increase shareholder returns, ▶have been targets of shareholder activism, or ▶are likely to become targets of shareholder activism.

Stocks targeted by shareholder activism refer to cases where activist funds or minority shareholder coalitions have initiated shareholder activism. Stocks likely to become targets of shareholder activism are heavily discounted due to governance issues but have the potential to increase corporate value if these issues are resolved.

Lee Sung-won, Head of ESG Investment Division at Truston Asset Management, said, "The domestic stock market has historically had very low shareholder value due to low dividend payout ratios and weak governance, but government regulatory changes and increased awareness of shareholder value among market participants are expanding." He added, "There is also a growing movement of companies voluntarily increasing shareholder returns. We will pursue a strategy to identify high-quality companies whose corporate value can rise through shareholder value enhancement."

He continued, "We will incorporate Truston's unique philosophy on shareholder value and its experience as the most active shareholder in Korea into this fund."

Meanwhile, Truston Asset Management was the first independent asset management company in Korea to adopt the Stewardship Code in 2017. Starting with Mando in 2013, when the concept of shareholder activism was still unfamiliar, it has actively engaged in shareholder activities targeting companies such as Taekwang Industrial and BYC recently.

This ETF will focus on investing in high-quality companies that can benefit from the growing interest in shareholder value under various circumstances, while structuring the overall portfolio to maintain a one-year correlation coefficient of 0.7 or higher with the benchmark index (KOSPI200) in accordance with active ETF regulations.

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