Shinhan Asset Management announced that its SOL Dividend Payout Top Pick Active ETF will pay its first monthly distribution on March 3, incorporating dividend payout ratio criteria into its investment strategy ahead of tax law revisions.
According to Shinhan Asset Management, the scheduled distribution is 70 won per share, representing a monthly distribution rate of approximately 0.54% and an annualized rate of about 4.3%. The SOL Dividend Payout Top Pick Active ETF is Korea's first ETF to use dividend payout ratio—the measure of how much profit a company returns to shareholders—as its core investment criterion.
Under last year's tax law amendments, companies that maintained or increased cash dividends year-over-year are classified as "dividend excellence" firms if their payout ratio exceeds 40%, or as "dividend effort" firms if their payout ratio exceeds 25% with cash dividends increasing more than 10% from the previous year. The ETF's benchmark methodology is designed to include only companies meeting these dividend payout requirements.
The ETF holds 23 stocks including Woori Financial Group, Kia, KT&G, Samsung Fire & Marine Insurance, Hyundai Elevator, Samsung Securities, NH Investment & Securities, BNK Financial Group, and GS. As an active ETF, constituents and weightings may change during portfolio management.
"We recently added SL Corporation, Seoul Guarantee Insurance, and SOOP to the portfolio after they significantly raised their dividend payout ratios to meet separate taxation requirements for dividend income," said Kim Jung-hyun, Head of ETF Business at Shinhan Asset Management. "Through our active strategy, we can promptly include companies with strong dividend payout ratios expected to benefit from policy changes as corporate shareholder returns strengthen."
Since listing last month, the SOL Dividend Payout Top Pick Active ETF has achieved a cumulative return of 28.55% amid the domestic stock market's steep rally. Net assets have also grown rapidly, expanding approximately sixfold from 10 billion won at listing to 61.3 billion won as of the February 27 closing price.