Two KODEX KOSPI 200 Covered Call ETFs Top KRW 4 Trillion in Individual Net Purchases This Year

KODEX Covered Call ETFs' Total Net Assets Reach KRW 12 Trillion
Rank No. 1 With a Market Share of About 45%

Samsung Asset Management said on October 26 that individual investors’ cumulative net purchases since the start of the year in its two KODEX KOSPI 200 Covered Call exchange-traded funds (ETFs) had topped KRW 4 trillion in total.

KODEX 200 Target Weekly Covered Call ranked first among all covered call ETFs, recording cumulative net purchases of KRW 3.0092 trillion by individual investors since the start of the year. Over the same period, KODEX 200 Covered Call Active also attracted KRW 1.1305 trillion in individual investor funds. It ranked first in cumulative net purchases by individual investors among covered call ETFs listed this year.

Samsung Asset Management applies different investment strategies to the two ETFs, even though both track the same KOSPI 200 Index. They give investors in covered call ETFs based on a benchmark index the choice between an “index” strategy and an “active” strategy. The steady cumulative net purchases by individual investors in both ETFs suggest that the products have gained market recognition and secured sufficient investment demand.

KODEX 200 Target Weekly Covered Call invests in the KOSPI 200 and sells weekly call options to earn option premiums. Its underlying index is designed to adjust the proportion of options sold with the aim of generating annual option premiums of 15%. The structure allows it to participate in stock market gains while securing funds for distributions through option premiums. Distributions are paid monthly, with the 15th of each month as the reference date.

KODEX 200 Covered Call Active applies an active strategy not only to options but also to its equity portfolio. It adjusts the portfolio weights of stocks, including those in leading sectors and companies with strong shareholder-return policies, and seeks to outperform its benchmark index. It responds to market changes by using equity management and options-selling strategies. Distributions are paid monthly, with the last day of each month as the reference date.

Investors can use the two ETFs to build a cash flow that provides distributions twice a month, in the middle and at the end of each month.

Choi Yonggeun, a manager at Samsung Asset Management, said, “KODEX Covered Call ETFs are becoming the covered call products of choice among individual investors. By investing in the two ETFs, investors can design a cash flow that provides distributions twice a month while also participating in gains in domestic indices.”

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