Samsung Active Asset Management announced on July 18 that the KoAct Dividend Growth Active Exchange-Traded Fund (ETF) will implement its first-ever special dividend payout of 2.5%. Investors who hold the KoAct Dividend Growth Active ETF until July 29, the day before the ex-dividend date, will be eligible to receive the special dividend. The dividend payment date is August 4.
The reason for the special dividend payout is the ETF's strong performance. Since its listing in February last year, the KoAct Dividend Growth Active ETF has outperformed its benchmark, the KOSPI index. The ETF has recorded returns of 8.8% over one month, 30.7% over three months, 32.4% over six months, and 20.8% over one year.
With recent shareholder return policies aimed at boosting the domestic stock market becoming more visible, the investment strategy of the KoAct Dividend Growth Active ETF is being recognized as well-aligned with current market trends. The ETF selectively invests in dividend growth stocks with continuously increasing dividends, companies with rising shareholder returns, and firms with improving cash flows. In addition to reviewing the frequency and yield of dividend payments, the ETF also checks the capacity for share buybacks to ensure that actual shareholder returns are growing. As changes in share buyback policies are anticipated, the ETF's ability to select investment targets stands out.
The KoAct Dividend Growth Active ETF has constructed a portfolio that invests in beneficiaries across various industries, including finance, chemicals, and electronics. The top sectors by investment weight are financials and holding companies. The ETF evenly includes 44 companies with strong cash flows and shareholder returns. The total management fee is 0.5% per year.
Nam Eunyoung, Head of Portfolio Management Team 1 at Samsung Active Asset Management, stated, "In the case of typical high-dividend stocks, because their earnings and payout ratios are already high, even if the dividend income separate taxation bill is passed, the increase in dividends compared to existing levels may not be significant." She added, "It is more desirable to invest in dividend growth stocks, where dividends can continue to grow compared to typical high-dividend stocks, or in holding companies that are likely to be re-evaluated as they increase their payout ratios."
Nam emphasized, "Alongside quantitative processes that select investment targets based on key investment indicators, it is also necessary to conduct qualitative work to individually identify companies aiming to increase future shareholder return rates," adding, "An active management style is more appropriate."
The KoAct Dividend Growth Active ETF pays dividends quarterly and distributed a dividend of approximately 1.5% in May.
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