Kiwoom Asset Management Launches Kiwoom Schroder Monthly Dividend Euro High Yield Fund

Kiwoom Asset Management announced on July 18 that it has launched the "Kiwoom Schroder Monthly Dividend Euro High Yield Securities Investment Trust (H) [Bond-FoF Type]" in collaboration with global asset manager Schroders. The fund is available in two types: a standard version and a monthly dividend version. The monthly dividend type is structured to provide regular monthly dividend income, aiming to secure steady income for investors.

While investment interest remains focused on the US and domestic markets, the European market is also expected to attract more attention in the future, supported by a favorable economic environment and stable interest rates. Recently, the European Central Bank (ECB) has cut its benchmark interest rate twice, entering an accommodative monetary policy cycle. In addition, inflation has stabilized at the low 1% range, creating a favorable environment for investing in euro high-yield bonds.

European companies are experiencing a broad recovery in earnings, coupled with improvements in employment indicators, resulting in continued positive fundamentals. In particular, Europe has moved to cut interest rates faster than the US, and with its accommodative policy stance and the presence of relatively undervalued assets, analysts suggest that increasing the allocation to Europe in global asset allocation strategies for the second half of the year is a valid approach.

The fund is a fund-of-funds structure that incorporates the offshore Schroder Global Fund as an asset, investing in euro-denominated global high-yield bonds to pursue both capital gains and income. The underlying fund, "Schroder ISF EURO High Yield Fund," posted a year-to-date return of 3.0% as of the end of June.

The underlying fund is managed by Schroders' high-yield specialist team, which is dedicated to global bonds. The team conducts thorough credit analysis and risk management based on an extensive research network and ESG analysis framework. Notably, the fund's average annual default rate over the past five years, as of the first quarter of this year, was approximately 1.09%, which is lower than the euro high-yield market default rate of about 3-4%, demonstrating a stable income structure.

Kiwoom Asset Management has diversified its business by absorbing the collective investment (fund) business segment of Schroder Investment Trust Management. Through this partnership, Kiwoom Asset Management will now manage domestic public funds that invest in Schroder's offshore funds. Since the offshore funds will continue to be managed by global asset manager Schroders, there will be no changes to the investment approach or the fundamental aspects of fund management.

A representative from Kiwoom Asset Management said, "This fund is a strategic product that considers not only regular monthly dividend income and the benefits of global diversification, but also capital gains resulting from interest rate cuts. It could serve as a new alternative for investors seeking stable cash flow amid market volatility."