[Provided by KB Asset Management]
[Provided by KB Asset Management]

As volatility in the domestic stock market has grown, investors seeking stable monthly cash flows have increasingly turned to covered call ETFs. Net assets in domestic covered call ETFs stood at around 15 trillion won ($10.2 billion) at the start of this year and have since grown to more than 26 trillion won — a gain of more than 11 trillion won in roughly half a year.

KB Asset Management on Monday proposed its RISE covered call ETF series as an investment alternative suited to volatile market conditions. Covered call ETFs hold underlying assets while selling call options, using the option premiums collected as a source of distributions. Because option premiums tend to expand as market volatility rises, the strategy has drawn attention as a stable income-oriented approach in the current market environment.

KB Asset Management currently operates a broad RISE covered call ETF lineup that includes products tracking major domestic indexes, leading US indexes, thematic funds focused on AI and high dividends, and bond-based strategies.

Among them, RISE covered call ETFs built on domestic indexes have attracted investor attention on the strength of stable monthly distributions and strong performance.

The RISE 200 High Dividend Covered Call ATM ETF posted a one-month return of 25.85%, the best among domestic equity ETFs.

The RISE Korea Value-Up Weekly Fixed Covered Call ETF paid a distribution of 590 won per unit in July — the highest since its listing — representing a monthly distribution rate of 3.30%. The ETF has also delivered a six-month return of 44.77%, combining stable monthly payouts with strong overall performance.

The RISE Daily Fixed Covered Call series, which invests in major US indexes and AI and dividend themes, has grown to approximately 1.5 trillion won in net assets, establishing itself as a leading lineup of overseas covered call products.

Comprising four funds — US Tech 100, US S&P 500, US AI Value Chain and US Dividend 100 — the series applies a "third-generation covered call" strategy that sells call options daily at 10 percent of the underlying index weighting, seeking both option premium income and participation in index gains. The RISE US Tech 100 Daily Fixed Covered Call ETF carries an annualized distribution rate of 19.68%.

Yuk Dong-hwi, head of KB Asset Management's ETF product marketing division, said the advantages of covered call strategies that harness option premiums become even more pronounced when market volatility expands as it has recently. "As demand for regular cash flows continues to grow, we will keep expanding the RISE covered call ETF lineup across a wide range of underlying assets — including major domestic and overseas indexes as well as AI, dividend and bond strategies — to broaden the choices available to investors," he added.

A new covered call product is also set to list. KB Asset Management's RISE Kosdaq Covered Call Active ETF is scheduled to list Tuesday. The product invests in Kosdaq-listed companies, concentrating on growth-oriented sectors including IT, healthcare and industrials, while flexibly selling Kosdaq 150 call options in response to market conditions.


th5@heraldcorp.com