'SOL 200 Target Weekly Covered Call' ETF Pays Out May Distribution of 217 Won Per Share

Monthly Distribution Rate of 1.45%

Shinhan Asset Management announced on June 1 that it has paid out the May monthly dividend for the "SOL 200 Target Weekly Covered Call" exchange-traded fund (ETF).

According to Shinhan Asset Management, this month's distribution amounts to 217 won per share, representing a monthly distribution rate of 1.45%.

Since its listing in March, the cumulative net purchases by individual investors reached 504.2 billion won as of May 29. Continued inflows from individual investors over approximately two months have driven the net asset value up to 758.3 billion won.

The SOL 200 Target Weekly Covered Call ETF employs a target covered call strategy, which invests in the KOSPI 200 and simultaneously sells domestic weekly call options to generate option premium income. In addition, it secures further distribution resources by incorporating dividend income generated from KOSPI 200 constituent stocks.

The target covered call strategy utilizes only a portion of the assets to pursue a target premium, in contrast to standard covered call approaches. The ratio of option sales can be flexibly adjusted, allowing for a higher level of market participation when the underlying asset rises. As a result, investors can secure stable premium income while reducing the risk of being left out during market rallies.

The company also highlighted the product's tax advantages. Domestic option premium income is exempt from taxation under Korean tax law and is not included in the comprehensive financial income tax. When investing through a regular account, investors can receive distributions with a lower tax burden compared to overseas covered call products. However, dividend income generated from investments in KOSPI 200 stocks is subject to dividend income tax.

Kim Junghyun, Head of the ETF Business Group at Shinhan Asset Management, stated, "As the KOSPI has surged approximately 26% over the past month and the upward trend continues, we are seeing growing interest from investors seeking to participate in the rally while also expecting stable monthly cash flow. The SOL 200 Target Weekly Covered Call maintains the advantages of domestic target covered call strategies while adopting a beginning-of-the-month distribution structure to enhance investors' cash flow management convenience."

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