'KIWOOM Samsung Electronics & SK hynix Bond Mix 50' ETF to Pay 151 Won per Share Distribution for September

151 Won Per Share Monthly, 1.25% Distribution Yield
Payment on the 17th for Purchases Made by the 11th

Kiwoom Asset Management announced on September 11 that its “KIWOOM Samsung Electronics & SK hynix Bond Mix 50” Exchange Traded Fund (ETF) will pay a monthly interim distribution of 151 won per share for September.

The record date for this distribution is the 15th, with the actual payment scheduled for the 17th. Investors who purchase the ETF by the 11th will be eligible to receive the distribution. The distribution yield for September is 1.25%.

This ETF has paid out more than 100 won per share for five consecutive months, starting with its first distribution in May following its listing in April. The per-share distribution amounts were 152 won in May, 159 won in June, 160 won in July, 139 won in August, and 151 won in September. The monthly distribution yields were 1.23%, 1.26%, 1.36%, 1.23%, and 1.25%, respectively.

The consistent monthly interim distribution is enabled by a “performance-linked special distribution” policy. While dividends from Samsung Electronics and SK hynix shares and interest income from bonds serve as the basic sources for distribution, additional distribution funds are secured by realizing a portion of gains from the ETF’s equity holdings when the ETF’s Net Asset Value (NAV) exceeds a certain threshold.

The special distribution is funded by trading gains from Samsung Electronics and SK hynix shares. Unlike a covered-call strategy that generates distribution resources from premiums earned by selling options, this approach regularly realizes part of the gains from appreciating shares and converts them into cash flows. This means investors can benefit from partial profit realization during ETF management, without having to decide on the timing of selling Samsung Electronics and SK hynix shares directly.

In addition, the trading gains from Samsung Electronics and SK hynix shares, which serve as the source for the special distribution, are subject to the same tax regime as gains from domestic equities. Therefore, in ordinary accounts, distributions funded by such trading gains can be received tax-free.

The KIWOOM Samsung Electronics & SK hynix Bond Mix 50 ETF allocates 25% of its assets each to Samsung Electronics and SK hynix for a total of 50%, with the remaining 50% invested in domestic short-term bonds. This bond-mix type ETF is designed to participate in the growth potential of Samsung Electronics and SK hynix while reducing portfolio volatility through bond holdings.

As a bond-mix product with equity exposure capped at 50%, this ETF is eligible for up to 100% allocation of retirement pension DC and IRP accounts. Applying a monthly interim distribution method, with the record date on the 15th every month, it allows for cash flow timing diversification when used in combination with other monthly distribution products that concentrate their record dates at the end of the month.

Kyungjun Lee, Head of ETF Management at Kiwoom Asset Management, stated, “One of the key decisions for investors in equity investing is when to realize profits from appreciating stocks. This product is structured so that, by investing in the growth of Samsung Electronics and SK hynix and meeting certain criteria, the ETF regularly realizes a portion of the gains and distributes it to investors. This enables investors to secure cash flow without the need to directly decide the timing of selling shares themselves.”

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