‘SOL US Dividend Dow Jones’ Stock Monthly Dividend ETF First to Surpass 100 Billion KRW in Net Assets

The net assets of the Korean version of SCHD, ‘SOL U.S. Dividend Dow Jones,’ have surpassed 100 billion KRW. This achievement was reached about four months after its listing, marking the first time for a monthly dividend stock ETF.

Listed last November with 8 billion KRW, the net assets of SOL U.S. Dividend Dow Jones have increased by 1,250% in just four months.

Kim Jeong-hyun, Head of the ETF Business Division at Shinhan Asset Management, said, “Despite relatively poor performance due to underperformance in sectors such as financials and consumer staples, which have a higher weighting compared to the S&P 500 since the beginning of the year, individual investors’ buying momentum has exploded,” adding, “From a long-term installment investment perspective, this can be interpreted as investors viewing short-term declines as buying opportunities.”

In fact, SOL U.S. Dividend Dow Jones, whose net assets have increased by about 80 billion KRW since the beginning of the year, recorded net purchases by individual investors of 14 billion KRW in the past week alone, and including pension accounts, inflows exceeded 20 billion KRW, ranking first in the domestic ETF market.

Kim explained, “In the first quarter of this year, SCHD (Schwab U.S Dividend Equity ETF) recorded a per-share distribution of 0.6 dollars, a 15.2% increase compared to the same period last year, once again proving the advantages of the dividend growth strategy, and this record will also apply to SOL U.S. Dividend Dow Jones,” adding, “We have also completed reflecting market conditions through recent regular rebalancing.”

Recently, the underlying index, the Dow Jones US Dividend 100 Index, underwent a major reshuffle of its components through its annual regular rebalancing. Through this change, 25 stocks including Abbvie and United Parcel Service (UPS) were added, while 24 stocks including IBM and Prudential Financial were removed. Notably, the weightings of the financial and IT sectors were significantly reduced from 18.5% and 17.9% to 14.4% and 12.5%, respectively, while healthcare (11.1% to 16.5%) and energy (5.2% to 8.9%) weightings increased, which is the most significant feature.

Kim added, “Through this rebalancing, we have reduced the risk associated with the recently volatile financial stocks, enabling an expected dividend yield in the mid-to-high 3% range,” and said, “The predictability of monthly cash flows will be the greatest advantage of investing in SOL U.S. Dividend Dow Jones.”

Meanwhile, SOL ETF recently launched a currency-hedged version, SOL U.S. Dividend Dow Jones (H), on the Korea Exchange to minimize performance impact due to increased exchange rate volatility, and it is currently sailing smoothly with stable buying momentum centered on individual investors.