Daishin Asset Management launches shareholder return high-dividend fund

Daishin Asset Management launched the Daishin Shareholder Return High-Dividend Fund on Tuesday. Jin Seung-wook, chief executive of Daishin Securities, visited the company's headquarters branch in Jung-gu, Seoul, that day to become the fund's first subscriber.

The fund invests in companies with large shareholder returns — through dividends and share buybacks and cancellations — while trading at relatively low valuations. It analyzes both a company's shareholder return policy and its share price level to identify stocks with high investment appeal.

The fund's two core investment indicators are the "shareholder return ratio" and the "shareholder return yield." The shareholder return ratio measures the proportion of a company's earnings returned to shareholders through dividends and share buybacks and cancellations. The shareholder return yield is analyzed alongside it to assess how attractive a company's total shareholder returns are relative to its current share price.

The portfolio is managed dynamically: when a holding's share price rises and its shareholder return appeal diminishes, the position is sold to lock in gains; when a price pullback restores its relative attractiveness, the stock is bought again.

The sustainability of shareholder returns is also a key investment criterion. The fund prioritizes companies with a consistent track record of shareholder return policies, and screens for those with stable cash generation and improving earnings that give them the capacity to maintain such returns.

Daishin Asset Management highlighted that domestic companies' shareholder return ratios lag those of major markets. Korea's projected shareholder return ratio this year stands at 31 percent, roughly half the levels seen in the United States (70 percent) and Japan (67 percent), according to the firm. It sees significant room for a revaluation of shareholder-friendly Korean firms as the trend toward stronger shareholder returns in the domestic capital market continues.

The Daishin Shareholder Return High-Dividend Fund is a publicly offered equity fund that allocates at least 60 percent of its assets to stocks, and was established Tuesday. It is available through 10 distributors, including Daishin Securities, with the distribution network set to expand over time.

"The market views not only a company's earnings but also how it shares that performance with shareholders as a core indicator of corporate value," said Lee Jae-woo, executive managing director of marketing at Daishin Asset Management. "What sets this fund apart is that it looks beyond dividends to assess how much is being returned to shareholders in total, and how attractive that return is at the current share price."

Daishin Asset Management has been actively rolling out products targeting high-dividend companies. This year it launched four tranches — Nos. 1 through 4 — of its Daishin Representative Companies and High-Dividend Target-Return Fund. The first two tranches each hit their target return within about six weeks of launch, demonstrating the firm's strong portfolio management capabilities.

In March, Daishin Securities revamped its retail strategy around an asset management model focused on generating regular cash flows from dividends and interest, and has since been expanding its supply of high-dividend and high-interest-rate products, including monthly income-paying offerings.