KB Asset Management's "RISE 200 Weekly Covered Call ETF" Surpasses 800 Billion Won in Net Assets

KB Asset Management announced on the 25th that the net assets of the KOSPI 200 index-based monthly dividend exchange-traded fund (ETF), the "RISE 200 Weekly Covered Call ETF," have surpassed 800 billion won. This achievement comes just one month after it exceeded 700 billion won in January.

As volatility in the global financial markets increases, investor demand for securing stable cash flow continues to grow. In line with this, monthly distribution-type ETFs that use covered call strategies to convert volatility into income are attracting attention as an investment alternative.

The RISE 200 Weekly Covered Call ETF, listed in 2024, is the first weekly covered call ETF in Korea. It seeks stable income by selling at-the-money (ATM) weekly call options based on a KOSPI 200 portfolio.

This ETF aims for relatively higher income compared to traditional monthly covered call strategies by selling call options twice a week, or about eight times a month. In particular, when the stock index moves sideways or declines, it seeks excess returns compared to the KOSPI 200 index.

It is also differentiated in terms of its distribution structure. By using the premiums from selling KOSPI 200 ATM call options and the dividends from KOSPI 200 constituent stocks as distribution sources, it can secure a stable pool of distributable income even during periods of high market volatility. On this basis, investors can expect a certain level of monthly dividends, and taxable income is relatively low, which is advantageous in terms of tax efficiency.

As of February, the cumulative annual distribution rate over the past year was 17.99%, with an average monthly distribution of 1.50%.

The RISE 200 Weekly Covered Call ETF has also delivered very strong performance. Its 6-month and 1-year returns stand at 58.82% and 91.36%, respectively.

Yook Donghwi, Head of ETF Product Marketing at KB Asset Management, said, "If you had invested 100 million won in the RISE 200 Weekly Covered Call ETF one year ago, you would have received approximately 15 million won in distributions before tax," adding, "It is a product that can be strongly recommended to investors of all age groups who seek stable monthly cash flow."