Shinhan Asset Management announced on the 6th that the assets under management of the ‘Shinhan MAN Global High Yield Monthly Dividend Fund’ series have surpassed 150 billion KRW. The strategy, which allows investors to gain both monthly dividends and capital gains while providing stable cash flow every month, has established itself as a useful investment tool for investors.
According to fund rating agency KG Zeroin, the ‘Shinhan MAN Global High Yield Monthly Dividend Fund’ recorded returns of 3.16% and 5.14% over 3 months and 6 months, respectively. It ranked first among global high yield funds. Within 10 months of its launch, it recorded assets under management exceeding 156 billion KRW, with more than 25 billion KRW flowing in over just two months since the beginning of the year.
The Shinhan MAN Global High Yield Monthly Dividend Fund maintains excellent performance while offering a high dividend yield. It shows an annualized dividend yield of around 7% and has paid monthly dividends 10 times since May last year. Based on the high interest income generated from the bonds held, the fund is designed to secure stable monthly dividend resources, enabling consistent and sustainable monthly dividend payments.
Generally, the YTW (Yield to Worst), which measures the minimum annualized return an investor can expect considering the possibility of early bond redemption and is used to gauge the performance of high yield funds, stood at about 8.85% as of the end of January. This outperforms the benchmark ICE BofA Global High Yield Index YTW of 6.73%.
The outstanding performance can be attributed to the excellent stock selection ability of the underlying fund, MAN GLG High Yield Opportunities Fund. In a situation where credit spreads have tightened, the fund’s overall yield (All-in-yield) provides a high level of buffer sufficient to prevent losses even if market interest rates rise by about 3%. Considering the robust growth rate of the U.S. economy, the carry return strategy of high yield bonds remains valid, and with expectations of continued interest rate cuts this year, the high yield bond market looks positive for the foreseeable future.
Park Jeong-ho, Fund Solutions Team Leader at Shinhan Asset Management, said, "As with last year, since U.S. high yield remains at a high level, we plan to focus on European high yield for the time being and seek U.S. investment opportunities when U.S. high yield prices adjust." He added, "To enhance fund stability, we are increasing the proportion of secured bonds and maintaining sufficient cash reserves to respond quickly to new opportunities."
Emerging as a leader in monthly dividends, Shinhan Asset Management recently launched the ‘Shinhan MAN Global Investment Grade Bond Monthly Dividend Fund’ on February 17, which invests in global investment-grade bonds, completing its monthly dividend lineup. Going forward, the company plans to meet investors’ needs with various products and strive to generate stable returns.
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