Samsung Future Assets, competing in investment through a semiconductor-backed bullish ETF

As semiconductor stocks strengthen, related investment demand expands, and Samsung Asset Management and Mirae Asset Management have launched different types of semiconductor covered call index funds, entering a stage of investor choice competition.

According to industry news on April 7, Mirae Asset Management listed the “TIGER Semiconductor TOP10 Covered Call Active” fund on April 21, while Samsung Asset Management plans to launch the “KODEX Semiconductor Target Weekly Covered Call” fund on May 12. Covered call ETFs are products that hold stocks while simultaneously selling call options, using the option premiums as a source of income. When stock prices do not decline sharply, they can expect relatively stable cash flow, making them a popular alternative investment recently. On the other hand, when stock prices rise significantly, there is a structural limitation that requires giving up some gains.

The difference between the two products lies in what assets they base their options on and how they sell the options. Mirae Asset Management has chosen an active strategy that directly uses options on individual semiconductor stocks such as Samsung Electronics and SK Hynix. Individual stocks tend to be more volatile than indices, which could potentially secure higher premiums. However, since the proportion of options sold depends on the fund manager’s judgment, market flexibility is maintained, but fluctuations in the fund’s returns may increase depending on the specific stock price movements. The target allocation rate is also not fixed, making it more suitable for investors seeking aggressive returns.

Samsung Asset Management has launched a passive strategy using KOSPI 200 index options with a target structure in its product name. The design aims to keep the proportion of options sold around 30%, targeting an annualized allocation rate of about 9%, while approximately 70% of the stock price increase is reflected in the fund’s returns. Conventional covered call products are often criticized for limited gains in rising markets, but Samsung Asset Management plans to address this weakness by reducing the options sold and using the remaining premiums to buy back stocks. Since index options are used, there is also an expected benefit of diversifying against sudden negative news affecting specific stocks.

Ultimately, this competition is likely to depend on whether investors prioritize income stability or the potential for additional gains. For long-term funds like retirement pension accounts that require stable cash flow, index-based target allocation products may be more suitable. Conversely, for investors willing to accept higher volatility and actively respond to market conditions in pursuit of excess returns, active products may serve as an alternative. Industry experts suggest that, rather than simply choosing products with high allocation rates, investors should consider both return stability, participation in upward markets, and volatility levels. As of April 30, the net asset size of domestic covered call ETF markets was 22.5 trillion won, with Samsung Asset Management holding about 46% at 10.4 trillion won, and Mirae Asset Management holding 7.3 trillion won, accounting for 32%. This trend may further expand amid the strengthening of semiconductor stocks and continued preference for monthly distribution products, but during sharp market rises, investors are also expected to scrutinize the return caps of covered call structures.