SOL Korea High Dividend ETF to Be Newly Listed

Shinhan Asset Management will list the monthly dividend product "SOL Korea High Dividend ETF," which reflects the latest dividend trends such as new government policy changes and tax reforms, on the Korea Exchange on September 23, 2025.

Unlike conventional high-dividend products that simply gather stocks with high dividend yields, the SOL Korea High Dividend ETF is a differentiated high-dividend ETF that incorporates strategies such as separate taxation on dividend income, reduced dividend benefits, and the effects of share buybacks.

In constructing its portfolio, the ETF selects 20 stocks with high expected dividend yields from companies with strong dividend growth and sound financial structures, in line with changes in the domestic dividend investment environment. Additionally, 10 more companies are added based on strong performance in reduced dividend implementation and share buyback yields, resulting in a total portfolio of 30 stocks.

When determining stock weights, additional emphasis is placed on companies expected to be eligible for separate taxation on dividend income, those implementing reduced dividends, and those executing share buybacks. While the maximum weight per stock is 5%, for companies meeting these criteria, the weight can be increased up to 7%.

Kim Junghyun, Head of ETF Business at Shinhan Asset Management, explained, "With the new government's strengthened shareholder return policies and expanded dividend tax benefits, investor interest in domestic dividend stocks is higher than ever."

He added, "Due to recent changes in the foreign tax credit method, the tax deferral effect for U.S. dividend ETFs within pension and ISA accounts has effectively disappeared. However, Korean dividend ETFs still maintain tax deferral or tax exemption benefits, making the careful selection of high-dividend ETFs increasingly important as effective investment vehicles within tax-advantaged accounts."

The SOL Korea High Dividend ETF has enhanced its investment appeal by reflecting separate taxation for high-dividend companies, tax exemption benefits for reduced dividends, and even discussions on mandatory share cancellation. The focus on companies implementing reduced dividends as a key selection criterion is a major differentiator, as this can lead to a tangible increase in actual ETF distributions through tax exemption benefits.

Top holdings in the portfolio include Woori Financial Group, Hana Financial Group, Kia, Hyundai Motor Company, and Shinhan Financial Group. Companies eligible for separate taxation on dividend income make up 76% of the entire portfolio. Companies implementing reduced dividends, such as Korea Financial Group and Hyundai Elevator, account for approximately 22%. As of the end of last month, the expected annual dividend yield based on the underlying index was 6.68%, offering both stability and attractive cash flow.

The first monthly dividend for the SOL Korea High Dividend ETF is scheduled to be paid on October 17, 2025, and the deposit time for the distribution may vary depending on each securities firm's policy.