Exchange-traded funds ( ETFs ) that diversify investments in ‘dividend growth stocks’ are emerging as ‘best-selling’ products. Dividend growth ETFs are almost the only product in which funds are steadily flowing in the domestic stock ETF market that is in recession . This is because more and more long-term investors are seeking stable dividends and investment gains from rising stock prices at the same time.

Hundreds of billions of funds flowed in in two monthsDividend growth stocks are the middle ground between high dividend stocks and growth stocks. Rather than the absolute size of the dividend, we pay attention to how steadily the dividend is increasing. Dividends increase every year, so even if you invest in a long-term installment method, the dividend-to-investment ratio increases every year. In order to continuously increase the dividend, cash flow from operations must also be supported. These companies are likely to rise in share price, so capital gains can be expected. According to the Korea Exchange on the 13th, there are currently 10 dividend growth ETFs

listed in Korea . All ETFs investing in US companies . Investment targets are blue-chip companies that have increased their dividends every year for as little as 10 years and as long as 50 years or more, and there are many such companies mainly in the US market. The most common dividend growth ETFs listed in Korea are ‘ ACE US Dividend Dow Jones’, ‘ SOL US Dividend Dow Jones’ and ‘ TIGER US Dividend Dow Jones’. TIGER US Dividend Dow Jones’s net assets reached 300 billion won in just two months after listing. SOL US Dividend Dow Jones and ACE US Dividend Dow Jones also have net assets of 260 billion won and 120 billion won, respectively. these ETFs

In common, it diversifies its investments in 100 companies, including Amgen, Home Depot, Broadcom, Cisco Systems, PepsiCo, Coca-Cola, and Chevron. They have one thing in common: they have solid market positions in household medicines, home interior products, and beverage markets. Looking at the dividend rate alone, the annual average is 2.9%, which is not as high as expected. The story changes when dividend reinvestment and stock price appreciation are taken into account. The Dow Jones US Dividend 100 Index, the underlying index of these ETFs , has risen at an annual average of 7.91% over the past 10 years. The annual average rate of return on investment, including dividend reinvestment, reached 11.56%.

Long-term investing in companies with 50 years of dividend growthETFs that only collect ultra-long-term dividend growth stocks are also popular. The ‘ KBSTAR US S&P Dividend King’ , which invests in companies that have increased their dividends for over 50 years, and the ‘ TIGER US S&P 500 Dividend Aristocrat’ , which collects companies that have increased메이저사이트 their dividends for over 25 years, are being traded. Although the dividend yield is higher than that of general dividend growth ETFs , the share price increase rate is relatively low. Investment return including dividend income has averaged 11% per year over the past 10 years. It is similar to a typical dividend growth ETF .

There are also products that use the covered call investment strategy while investing in dividend growth stocks. A covered call is an investment strategy in which you invest in a stock and sell a call option on that stock. You can maximize the dividend income you receive on a periodic basis with option premiums. You can protect against losses during market downturns, but your gains are limited during uptrends. In Korea, ‘ TIGER US Dividend + 7% Premium Dow Jones’, ‘ TIGER US Dividend + 3% Premium Dow Jones’, ‘ KODEX US S&P 500 Dividend Aristocrat Covered Call (Synthetic H)’ are being traded. Fund management fees are relatively high.

U.S. uses a variety of strategiesUnlike the domestic market, which opened in earnest at the end of last year, various dividend growth ETFs are traded in the US. ‘Vanguard Dividend Appreciation ( VIG )’ and ‘Schwab US Dividend Equity ( SCHD )’ are the most representative dividend growth ETFs . Their net assets reach 109 trillion won and 62 trillion won, respectively. Invest in companies that increase dividends over the long term, such as domestic dividend growth ETFs . Ultra-long-term dividend growth ETFs include ‘ProShares Russell US Dividend Growth ( TMDV )’ and ‘ProShares S&P 500 Ibidund Aristo Cats ( NOBL )’. ‘ FT Cboe Best S&P 500 Dividend Aristo Cats Target Income ( KNG )’ with covered call strategy is also actively traded.There are many ETFs that combine dividend growth stocks with other investment strategies . ‘Invesco High Yield Equity Dividend Achievers ( PEY )’ invests intensively in small and medium-cap dividend growth stocks. Compared to large-cap stocks, stability is lower, but relatively higher returns can be expected. Telecommunications company Telephone & Data Systems and VF Corporation , a clothing company that owns the North Face brand, are the main investment companies. ‘X Trackers S&P 500 ESG Dividend Aristo Cats ( SNPD )’ , which selects and invests in ESG excellent companies , is also attracting investment money recently. Among dividend growth stocks, diversify investments in companies with strengths in the ESG area. ‘ProShares S&P Technology Dividend Aristo Cats’ ( TDV ), which selects technology stocks from dividend growth stocks, is also a product worth paying attention to.