SOL International Gold ETF Newly Listed...Tracks International Spot Gold Prices

On June 17, Shinhan Asset Management will newly list the 'SOL International Gold ETF' on the Korea Exchange, which tracks international spot gold prices 100%.

This is the first product among gold-related ETFs listed in Korea to directly track international spot gold prices. Existing gold ETFs have tracked either domestic spot gold or international gold futures prices, but the SOL International Gold ETF invests in ETFs that track the London Bullion Market Association (LBMA) price, which is the international standard for spot gold. This has the advantage of being free from price distortions caused by domestic supply and demand factors such as the Kimchi Premium.

The London gold market accounts for about 50% of the global nominal value of gold trading. Kim Junghyun, Head of ETF Business Division at Shinhan Asset Management, stated, "Considering structural demand factors such as the global financial market environment, geopolitical risks, and the expansion of gold purchases by central banks in various countries, there is a high possibility that the upward trend in gold prices will continue in the medium to long term."

He added, "Gold is now established as a major investment asset, beyond serving merely as a supplementary means of asset allocation," and emphasized, "A strategic approach that takes into account premium risk management is now necessary."

The SOL International Gold ETF does not require rolling over futures contracts, so it is not affected by the rollover impact that occurs with gold futures ETFs. Its advantage lies in its ability to track international gold prices honestly and efficiently.

Kim stressed, "Rollover impact and premium risk are key factors that cause a gap between gold price movements and actual returns," and added, "If you are considering gold as a long-term investment tool, such as in a pension account, an ETF that tracks international gold prices can be a more efficient and stable alternative."

With this listing, Shinhan Asset Management has completed a lineup of two gold ETFs that track international gold prices. The 'SOL Gold Covered Call Active ETF', listed in March, is the first ETF in Korea to combine a covered call strategy with commodities as the underlying asset. It is a product that allows investors to pursue both capital gains from rising gold prices and income returns at the same time.