KCGI Asset Management said on the 14th it launched the "KCGI Korea Dividend Growth Securities Investment Trust [Equity]," which invests in high-quality domestic dividend growth stocks. On the fund's inception date, on the 10th, 31.1 billion won flowed in within a day.
Unlike simply adding stocks with high current dividend yields, this product selects and invests in corporations that can keep expanding dividends as profits grow. The strategy aims to reduce market volatility through dividend stocks while also holding growth names to seek revenue opportunities even in rising markets.
Four criteria are applied to pick stocks: profits and dividends, growth potential, and shareholder returns. It determines investment targets by comprehensively evaluating financial soundness such as return on equity (ROE), operating cash flow, and the liability ratio; past performance and dividend trends; the possibility of earnings improvement with industry growth; and a corporation's willingness to return profits to shareholders.
The portfolio will be built around corporations that are pushing to raise payout ratios alongside earnings growth, corporations with high medium- to long-term earnings visibility and payout ratios of 40% or more, and corporations with dividend yields above the market average.
KCGI Asset Management also sees the recent profit growth of domestic corporations and the expansion of shareholder returns as positive factors for the dividend growth stock investment environment. According to the company, combined net profit of KOSPI-listed firms increased from 102 trillion won in 2023 to 202 trillion won in 2025, and the scale of shareholder returns, including dividends and share buybacks and cancellations, also rose 37% and 39% in 2024 and 2025, respectively.
It also cited the Commercial Act revision and the corporate value-up policy as factors that could lead to a reassessment of dividend growth stocks. Since disclosures of plans to enhance corporate value began, the number of corporations that filed related disclosures has exceeded 700, and the net worth of value-up exchange-traded funds (ETF) expanded to 3.1 trillion won as of April.
The asset manager projected that, as domestic corporations' dividend yields and payout ratios are lower than in major countries, the investment appeal of dividend stocks will increase as shareholder returns expand going forward.
The fund is managed as a mother-daughter structure, publicly offered equity fund that invests 60% or more of trust assets in domestic stocks. There is no maturity limit and no mid-term redemption fee.
A KCGI Asset Management official said, "In a volatile market, we will pursue a hybrid strategy that reduces volatility through dividend stocks and selects and adds growth stocks with sustained profit growth, thereby securing relative defensiveness in downturns while not being left out when the market rebounds."