KB Asset Management said on the 18th that its RISE Korea Value-Up Weekly Fixed Covered Call exchange-traded fund has surpassed 300 billion won ($216 million) in net assets, with monthly distributions staying above 3% for a third consecutive month.
The fund launched in September last year. As a monthly distribution ETF, it has paid out a total of 4,200 won per share over the past year, for an annual distribution rate of 24.69%. Distribution rates have topped 3% for three straight months, at 3.22% in July, 3.21% in August and 3.08% in September.
The fund holds the 100 stocks in the Korea Value-Up Index and sells KOSPI 200 call options twice a week on a fixed 30% of assets, a weekly covered call structure. By capping the option-selling portion at 30%, the fund uses the premiums collected as the source for distributions while allowing the remaining 70% to participate in gains in the underlying stocks.
Major holdings include SK hynix at 20.12%, Samsung Electronics at 16.14%, SK Square at 7.82%, KB Financial Group at 4.48%, Hyundai Motor at 4.10%, Shinhan Financial Group at 3.81%, Hanwha Aerospace at 2.86%, Hana Financial Group at 2.80% and Kia at 2.46%. As of the previous day, the one-year return stood at 99.00%, with a total expense ratio of 0.30% a year.
"Interest in value-up stocks is continuing as shareholder return policies strengthen, including share buybacks and cancellations and larger dividends," said Yook Dong-hwi, head of ETF product marketing at KB Asset Management. "It is an effective investment vehicle that lets investors hold blue-chip stocks while expecting high monthly distributions."
