Samsung Asset Management said Wednesday that the combined net asset value of its two target weekly covered call exchange-traded funds (ETFs) topped 1.3 trillion won ($940 million).

Specifically, the KODEX 200 Target Weekly Covered Call ETF totaled 903.3 billion won while the KODEX Financial High Dividend TOP10 Target Weekly Covered Call ETF was at 422.1 billion won.

Covered call ETFs generate returns by selling derivatives known as options, which can help cushion losses during market downturns. However, their performance may lag behind in bullish markets as the option strategies act as a cap on growth.

To address this, Samsung’s target weekly covered call ETFs limit option selling to 30 percent of their portfolios, allowing the remaining 70 percent to capture equity market gains.

The company also highlighted that both ETFs provide mid-month dividends, which is appealing to investors. The 200 Target Weekly ETF offers an annualized yield of about 17 percent, while the Financial High Dividend TOP10 version yields around 15 percent - paid out monthly. The two ETFs have different payout schedules - on the 15th of each month and the last business day respectively - allowing investors to potentially build a bi-monthly cash flow strategy.

“These ETFs are designed to participate in market rallies while maintaining stability during volatile periods,” Samsung Asset Management said. “Moreover, income from option trading is fully tax-exempt and not subject to aggregate financial income taxation, making them attractive to high-net-worth investors who are sensitive to tax issues.”

[ⓒ 매일경제 & mk.co.kr, 무단 전재, 재배포 및 AI학습 이용 금지]