KB Asset Management Launches 'RISE Korea Financial High Dividend ETF' Suitable for Pension Investment

KB Asset Management has launched an exchange-traded fund (ETF) that invests in high-dividend financial stocks in Korea. It is the 'RISE Korea Financial High Dividend' ETF, which was listed on the 10th.

Financial stocks, which are representative high-dividend stocks, show a stable dividend flow based on solid profit trends despite changes in domestic and international environments such as interest rate cuts or the U.S. presidential election.

The average dividend yield of the domestic financial sector (59 stocks) in the previous year was 4.84%, more than twice that of the KOSPI (1.83%) during the same period.

Since the announcement of the government-led value-up program recently, each financial holding company has also announced plans to enhance corporate value, including active shareholder returns.

The 'RISE Korea Financial High Dividend ETF' tracks the ‘iSelect Korea Financial High Dividend Index’ as its benchmark index.

It invests in a total of 13 stocks selected from companies within the financial holding, banking, securities, and insurance sectors based on four factors (return on equity, dividend yield, price-to-book ratio, and market capitalization). However, even if a company ranks high in these factors, those with dividend yields lower than the average of listed stocks on the Korea Exchange are excluded from the final inclusion, prioritizing dividend yield.

As of the end of November, the major investment stocks include JB Financial Group (10.33%), DB Insurance (10.29%), KB Financial Group (10.27%), Hana Financial Group (10.10%), and Woori Financial Group (10.06%).

Looking at the previous year's cash dividend yields of the included stocks, Industrial Bank of Korea (8.30%), Hana Financial Group (7.83%), NH Investment & Securities (7.74%), and Woori Financial Group (7.69%) rank highest. The weighted average dividend yield of the entire portfolio, considering the investment weight of each stock, is about 6.82% annually.

Kim Chan-young, head of the ETF Business Division at KB Asset Management, explained, "'RISE Korea Financial High Dividend' is designed to pursue the highest dividend yield among domestic equity ETFs while constructing a balanced portfolio across financial sectors such as financial holdings, banks, securities, and insurance that can benefit from the value-up program. Considering the stable dividend flow, it is well suited as a pension investment product."