Korea Investment Management said on the 15th that it will newly list the "ACE high-dividend stocks" exchange-traded fund (ETF) on the 16th of this month.
The "ACE high-dividend stocks" ETF is a domestic equity product that tracks the "KRX-Akros High Dividend 20 Index (market prices)" calculated and published by the Korea Exchange (KRX). The index includes 20 constituents selected by comprehensively considering not only market representativeness and liquidity but also dividend yield, payout ratio, and profitability (ROE).
This product reflects the "ex-dividend recovery rate." When the ex-dividend recovery rate is low, it is interpreted as dividends being excessive relative to fundamentals, and investors should consider the potential for total return erosion due to share price declines. Accordingly, the product adopts a strategy that selects stocks with strong ex-dividend recovery rates to seek not only dividend income but also capital gains.
Distributions are paid monthly. The source of distributions consists of dividend income from stocks held by the ETF and realized capital gains from rebalancing constituents. The record date for distributions is the last business day of each month, and details such as the distribution amount can be found on the ACE ETF website and blog.
Nam Yong-su, head of ETF management at Korea Investment Management, said, "As government-led efforts to improve the structure of the domestic stock market continue, demand for investment in domestic high-dividend stocks is increasing," and emphasized, "To respond to government policies, corporations that aggressively raise dividends risk damaging corporate value, so investments in high-dividend stocks that reflect the ex-dividend recovery rate, like the ACE high-dividend stocks ETF, are necessary."
The ACE high-dividend stocks ETF can be invested in up to 70% of assets in defined contribution (DC) and individual retirement pension accounts.