Just One Month After Surpassing 400 Billion Won in Net Assets
Separate Taxation on Dividend Income Further Boosts Appeal of High-Dividend Stocks
Hanwha Asset Management announced on February 13 that the net assets of its “PLUS High Dividend Stock & Bond Mixed” exchange-traded fund (ETF) have surpassed 500 billion won.
According to financial information provider FnGuide, the net assets of the “PLUS High Dividend Stock & Bond Mixed” ETF stood at 564.3 billion won as of February 12. This achievement comes just about a month after its net assets exceeded 400 billion won last month.
This performance is seen as the result of improvements in the domestic capital market system that are favorable to high-dividend stocks, including stronger shareholder returns by companies due to amendments to the Commercial Act, and the introduction of separate taxation on dividend income. Backed by these expectations, the “PLUS High Dividend Stock & Bond Mixed” ETF rose 12.1% over the past month (based on net assets as of the 11th).
Its high usability within pension accounts is also drawing attention. The “PLUS High Dividend Stock & Bond Mixed” ETF is classified as a non-risk asset, making it eligible for up to 100% allocation in pension accounts. There is strong investment demand for the remaining 30% portion outside the 70% limit for risk assets.
By using tax-advantaged accounts such as pension accounts, investors can defer taxation on the distributions received from the “PLUS High Dividend Stock & Bond Mixed” ETF. If the full amount of the distributions is reinvested for the long term, the compound interest effect can be maximized.
The “PLUS High Dividend Stock & Bond Mixed” ETF invests 50% in domestic high-dividend stocks and 50% in three-year Korean Treasury bonds, and is a monthly dividend ETF that pays distributions every month using stock dividends and bond interest as distribution sources.
Last year, it consistently paid a monthly distribution of 45 won per share, and starting in January this year, the monthly distribution per share was raised to 48 won. By providing predictable fixed income, it allows retirees who need living expenses to invest in a stable manner.
Jeongseop Geum, Head of the ETF Business Division at Hanwha Asset Management, said, “If the conditions for high-dividend companies are met, separate taxation will be applied to dividends received from the first quarter of this year, which we believe makes this a point in time when the investment appeal of high-dividend stocks has become very strong,” adding, “The number of retirees is also steadily increasing, so demand for dividend stock investment will continue throughout this year as well.”
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