Hantoo Asset Management "ACE 15% Premium Distribution Series, Dividend Payment on 17th"

Korea Investment Trust Management announced on the 10th that the ACE 15% Premium Distribution (Synthetic) Exchange-Traded Fund (ETF) series will pay dividends on the 17th.

The ACE 15% Premium Distribution (Synthetic) ETF series refers to the covered call strategy ETFs listed by Korea Investment Trust Management in April. The series consists of three products: ACE US 500 15% Premium Distribution (Synthetic) ETF, ACE US Big Tech 7+ 15% Premium Distribution (Synthetic) ETF, and ACE US Semiconductor 15% Premium Distribution (Synthetic) ETF.

To receive dividends from the ACE 15% Premium Distribution (Synthetic) ETF series, which distributes dividends monthly, investors must purchase the ETFs by the 11th. Korea Investment Trust Management will pay dividends on the 17th to investors holding the ETFs as of the record date on the 15th. The size of the July dividend will be announced after the market closes on the 11th.

The ACE 15% Premium Distribution (Synthetic) ETF series uses zero-day-to-expiration (0DTE) options expiring within 24 hours and out-of-the-money (OTM) 1% options that partially track market performance to pursue an annual target distribution rate of 15%. Korea Investment Trust Management was the first in Korea to introduce covered call ETFs utilizing zero-day-to-expiration options.

Among the ACE 15% Premium Distribution (Synthetic) ETF series, the ACE US Big Tech 7+ 15% Premium Distribution (Synthetic) ETF and ACE US Semiconductor 15% Premium Distribution (Synthetic) ETF feature a mismatch strategy between the underlying index they track and the option assets. They track underlying indices investing in high-growth US big tech and semiconductor companies, respectively, while utilizing Nasdaq 100 0DTE options, which facilitate option premium collection.

Since covered call ETFs can incur losses if the decline in the underlying index exceeds the option premium due to their product structure, selecting a high-growth underlying index is important. Accordingly, Korea Investment Trust Management chose underlying indices with long-term growth potential. In particular, this strategy can generate additional returns if the underlying index outperforms the Nasdaq.

Seunghyun Kim, ETF Consulting Manager at Korea Investment Trust Management, introduced, "The ACE 15% Premium Distribution (Synthetic) ETF series was launched to meet the demand of monthly dividend investors who want to receive dividends not only at the end of the month but also during the month." He added, "It is characterized by being the first in Korea to utilize long-term growing underlying indices and 0DTE OTM 1% options to consistently provide a high annual distribution rate and pursue stock price appreciation."

The ACE 15% Premium Distribution (Synthetic) ETF series is a performance dividend product, and principal loss may occur depending on the management results. Also, the annual target distribution rate of 15% pursued by the ACE 15% Premium Distribution (Synthetic) ETF series may not be paid depending on the management situation.