PLUS High Dividend ETF Surpasses 1 Trillion Won in Net Assets

Hanwha Asset Management announced on June 24 that the total net assets of its 'PLUS High Dividend Stock Exchange-Traded Fund (ETF)' have surpassed 1 trillion won.

Following the recent success of the 'PLUS K-Defense ETF', another ETF with net assets exceeding 1 trillion won has emerged. According to financial information provider FnGuide, as of June 20, the PLUS High Dividend ETF recorded total net assets of 1.011 trillion won.

Listed in August 2012, the PLUS High Dividend ETF is the largest dividend ETF investing in Korean equities and is referred to as the "Korean version of SCHD" (the leading U.S. high-dividend ETF). It invests in the top 30 companies with the highest projected future dividend yields. In May last year, the ETF switched from quarterly to monthly distributions, drawing significant interest, especially from retirees.

Hanwha Asset Management described the PLUS High Dividend ETF surpassing 1 trillion won in net assets as a result of a "structural money move." The domestic high-dividend ETF market is experiencing rapid growth.

The total net assets of the 22 high-dividend ETFs listed on the Korea Exchange surged by 80%, from 1.2 trillion won at the end of 2024 to 2.3 trillion won this year. During the same period, the growth rate of overseas high-dividend ETFs was only 4.1%. Analysts attribute the increasing share of domestic dividend investments among Korean individual investors to rising demand for pension-type portfolios in an aging society and to policy changes in retirement pensions.

According to a survey conducted by Charles Schwab, a leading U.S. financial company, 57% of American investors aged 60 and above consider dividend ETFs as a primary investment vehicle.

Kim Jungsub, head of the ETF Business Division at Hanwha Asset Management, stated, "The trend of 'dividend ETF core allocation' observed in the U.S. pension market will become mainstream in Korea as well," emphasizing, "Individual investors' investment objectives are now expanding beyond simple capital gains to 'lifestyle portfolios focused on cash flow.'"

Institutional improvements and policy pledges favorable to domestic dividend stocks have also played a significant role in the growth of the PLUS High Dividend ETF. The 'Value-Up Policy,' which has been actively promoted since last year, led to a general rise in the share prices of dividend stocks with relatively low price-to-book ratios (PBR). In addition, as the new administration pursues a policy to institutionalize shareholder returns by requiring listed companies to retire treasury shares in principle, capital inflows into the PLUS High Dividend ETF have accelerated.

Kim further explained, "In an era of low birth rates and aging populations, dividend stocks that can function as alternatives to pensions will become an increasingly essential asset class," adding, "The era in which dividends become the core of stock investment in the Korean market will begin in earnest."

The PLUS High Dividend ETF has served as a reliable support for investors, providing annual distributions of around 5-6% even during periods when the domestic stock market was sluggish or range-bound. Considering reinvestment of distributions, the PLUS High Dividend ETF recorded returns of 37.4% over the past year, 86.6% over three years, and 173.3% over five years, based on closing prices as of June 17.