‘SOL Comprehensive Bond (AA- or higher) Active ETF’ Year-to-Date Performance No.1
7.59% Since Early Year, No.1 Among Comprehensive Bond ETFs
Bond ETFs Surpass 1 Trillion KRW in Net Assets
Shinhan Asset Management announced on the 21st that the 'SOL Comprehensive Bond (AA- and above) Active' Exchange-Traded Fund (ETF) recorded a 7.59% return since the beginning of the year. As of the 19th, it showed the best performance among the nine comprehensive bond ETFs listed in the domestic ETF market. This product was listed in August last year, and institutional investors' funds have been continuously flowing in. Approximately 245 billion KRW has been invested this year alone.
On the day, Heo Ik-seo head of the Bond ETF Management Team at Shinhan Asset Management explained, “we generate additional returns through active market responses based on a relative value strategy. At the beginning of the year, we judged that credit bonds were undervalued compared to fundamentals and actively incorporated credit bonds. Subsequently, as credit spreads rapidly narrowed, we were able to achieve excellent returns.”
He added, “The rapid decline in interest rates was also positive for returns. This was mainly due to actively extending duration based on the judgment that the market interest rate increase in the third quarter was excessive.”
Kim Jeong-hyun, head of the ETF Business Division at Shinhan Asset Management, stated, “Demand for bond assets continues to strengthen in a high-interest-rate environment, so the growth of the bond ETF market is expected to continue,” and added, “We will strive to develop attractive bond ETFs that individual investors can invest in through retirement pension accounts.”
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Meanwhile, SOL ETF plans to strengthen its bond asset lineup by listing the ‘SOL U.S. 30-Year Treasury Covered Call (Synthetic)’ ETF on the 27th. Director Kim added, “The covered call strategy is most attractive during periods of high volatility when the U.S. interest rate hikes are ending and gradual cuts are beginning, so it will be a suitable product for investors seeking higher income returns compared to U.S. long-term bond ETFs.”
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