NH Investment & Securities Lists New SOFR Rate-Linked ETN in the US Market

NH Investment & Securities announced on the 15th that it will newly list the "QV USD SOFR Rate Plus ETN" product, which tracks the "SOFR (Secured Overnight Financing Rate)" published daily by the Federal Reserve Bank of New York.

SOFR is an interest rate calculated based on overnight repurchase agreement (RP) transactions secured by U.S. Treasury securities, published by the Federal Reserve Bank of New York. This product is based on the "Solactive SOFR +10 Daily Total Return Index," published by the German index provider Solactive AG, and aims to achieve a return by adding 10bps to the SOFR rate.

This product allows investors to receive interest equivalent to SOFR +10bps while investing in U.S. dollars, and unlike typical parking accounts or time deposits, it offers the advantage of compound interest, making it highly competitive. Since the SOFR rate has maintained a level above 5% from June this year until now (as of December 8, 2023), it will be attractive to investors who want to invest in the U.S. short-term money market.

However, this product is exposed to foreign exchange risk, meaning fluctuations in the KRW-USD exchange rate can affect investment performance. Even if profits arise from changes in the underlying index, fluctuations in the KRW-USD exchange rate may offset or erode those gains, so caution is required. The issuance volume of this product is 2 million shares, with a total issuance size of 20 billion KRW, and the issue price is 10,000 KRW per share.

The total fee is 0.05% per annum, reflected daily on a pro-rata basis in the final indicative value (IV). The maturity is 2 years, with a maturity date of December 8, 2025, and the final trading day is December 4, 2025. The maturity redemption payment will be made on December 10, 2025, based on the final indicative value (IV) on the final trading day.

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