'TIGER US S&P 500 Target Daily Covered Call' ETF to Pay 115 Won in October Distribution
Second distribution since shift to mid-month payments
Stock dividend income also included in distribution sources
Mirae Asset Global Investments said on October 13 that the TIGER US S&P 500 Target Daily Covered Call ETF will pay a distribution of 115 won for October.
This is the ETF's second distribution since it changed its distribution record date from the end of each month to the middle of the month. It paid its first mid-month distribution of 114 won in September. Along with the shift to mid-month distributions, the ETF has diversified its distribution sources by including dividend income from its underlying stocks, in addition to the option premium income it previously relied on. The October distribution will be paid to investors who purchased shares by today.
The TIGER US S&P 500 Target Daily Covered Call ETF seeks to capture growth in the S&P 500 Index while generating cash flow from option premiums. It is designed to sell short-dated daily options equivalent to about 10% of its exposure, allowing it to participate in about 90% of the underlying index's gains. By keeping the share of options sold low, it aims to capture the S&P 500 Index's growth while also providing regular cash flow.
Mirae Asset Global Investments has staggered the distribution schedules of the TIGER US S&P 500 Target Daily Covered Call ETF and the TIGER US Nasdaq 100 Target Daily Covered Call ETF. The S&P 500 Target Daily Covered Call ETF has a distribution record date of the 15th of each month, while the Nasdaq 100 Target Daily Covered Call ETF's is the last day of each month. Investors who hold both products can therefore receive distributions every two weeks.
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Lee Jeonghwan, head of the Strategic ETF Management Division at Mirae Asset Global Investments, said, "The TIGER US S&P 500 Target Daily Covered Call ETF is designed to minimize the share of options sold and focus on preserving as much of the S&P 500's long-term growth potential as possible. By shifting to mid-month distributions, investors can combine it with the TIGER US Nasdaq 100 Target Daily Covered Call ETF to invest in leading U.S. indices with long-term upward trends while structuring a steady cash flow every two weeks."
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