13 out of Top 20 Net Purchases
TIGER US S&P500 Ranked No.1 in Purchases
Growing Interest in US Dividend-Related ETFs
As domestic stock markets continue to struggle due to internal and external issues, investors' interest in the U.S. stock market is growing. Unlike the domestic market, which has repeatedly underperformed this year, the U.S. stock market is showing strength by hitting record highs. Among the top ETFs by net purchases from individual investors this year, many are U.S.-related ETFs, reflecting strong interest from domestic investors in U.S. investments.
According to the Korea Exchange on the 11th, among the top 20 ETFs by net purchases from individual investors through the 8th of this month, 13 were ETFs investing in the U.S. The most purchased ETF was TIGER U.S. S&P 500. Individual investors have net bought TIGER U.S. S&P 500 worth 1.64 trillion KRW this year. The net assets of TIGER U.S. S&P 500 surpassed 5 trillion KRW last month. This is the first time a foreign stock ETF listed domestically has exceeded 5 trillion KRW in net assets. The TIGER U.S. S&P 500 ETF tracks the S&P 500 index, one of the three major U.S. indices alongside Nasdaq 100 and Dow Jones 30. The S&P 500 index includes large-cap stocks accounting for about 80% of the total U.S. market capitalization, reflecting the overall U.S. economic situation. The year-to-date return of TIGER U.S. S&P 500 has exceeded 40%.
Interest in U.S. dividend-related ETFs is also increasing. Individual investors have net bought TIGER U.S. Dividend Dow Jones worth 1.0135 trillion KRW this year, making it the fourth most purchased ETF overall. It is the second most net purchased U.S.-related ETF after TIGER U.S. S&P 500. Thanks to strong net buying by individuals, this ETF surpassed 1 trillion KRW in net assets within one year of its listing on June 20 last year. As of the 6th of this month, its net assets stood at 1.8075 trillion KRW, the highest among five similar products. TIGER U.S. Dividend Dow Jones is a monthly distribution ETF that invests in high-quality, high-dividend companies with excellent dividend growth rates, which have consistently paid dividends for over 10 years. Including the payment date at the end of November, it recorded an average distribution of 35.7 KRW and an annual distribution yield of 3.74%. The underlying index of this ETF is the 'Dow Jones US Dividend 100 Index,' which is also tracked by the Schwab US Dividend Equity ETF, a representative U.S. dividend ETF. The ability to receive the high dividend income paid by the U.S. SCHD ETF on a monthly basis has attracted significant interest among individual investors.
Interest in covered call ETFs is also high. Individual investors have net bought various U.S.-related covered call ETFs. They net purchased TIGER U.S. 30-Year Treasury Covered Call Active (H) worth 673.1 billion KRW, TIGER U.S. Nasdaq 100 Target Daily Covered Call 384.1 billion KRW, TIGER U.S. Dividend Dow Jones Target Covered Call No. 2 329.3 billion KRW, KODEX U.S. 30-Year Treasury Target Covered Call (Synthetic H) 264.3 billion KRW, and TIGER U.S. Tech TOP 10 Target Covered Call 214.6 billion KRW. Covered call is a strategy that involves buying the underlying asset while simultaneously selling call options on that asset. Using a covered call strategy can buffer losses by the amount of the option premium when stock prices fall, but it limits the upside potential to a certain level when prices rise.
The TIGER U.S. 30-Year Treasury Covered Call Active (H) ETF invests in U.S. 30-year Treasury bonds and employs a covered call strategy to pursue monthly distributions of over 1%. Since its listing on February 27, it has paid a total dividend of 8.9% over 8 distributions as of the end of October. This is the highest level among bond-type monthly distribution ETFs listed domestically during this period. The TIGER U.S. 30-Year Treasury Covered Call Active (H) limits the call option selling ratio to a maximum of 30%, with the remaining 70% following bond capital gains during interest rate cuts. Amid increasing uncertainty about the timing of interest rate cuts, investors can receive steady monthly dividends by leveraging the high volatility of the U.S. long-term bond market while waiting for rate cuts.
The TIGER U.S. Nasdaq 100 Target Daily Covered Call ETF surpassed 500 billion KRW in net assets about four months after its listing in June. This ETF invests in the Nasdaq 100 index, a major U.S. index, and aims for an annual dividend yield of 15% as a monthly distribution covered call ETF. It reduces the option selling ratio to below 10%, with the remaining approximately 90% participating in the Nasdaq 100 index's rise. This structure, which reduces the option selling ratio and maximizes participation in index gains, compensates for the typical covered call ETF characteristic where gains are capped during price rises and losses occur alongside price drops.
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