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Shinhan Asset Management launches balanced ETF tracking Solactive US Top 5 Balanced 40 Index


Frankfurt-based index provider, Solactive writes that when it comes to investing, diversification is the most important element in achieving long-range financial goals while generating higher risk adjusted returns. 

It also helps to mitigate unsystematic risks and may lead to better opportunities, the firm says. Therefore, the combination of equities, which generally provide higher returns than other asset classes, and bonds, which usually help to control the volatility over time, in a balanced fund will help Korean investors to explore new investment possibilities, Solactive ways. 

In the first engagement with Solactive, Shinhan Asset Management and their ETFs brand SOL, launches a new instrument in that space. The Shinhan SOL US TOP5 40 Blended ETF (447620.KS) tracks the Solactive US Top 5 Balanced 40 Index.

The Solactive US Top 5 Balanced 40 Index measures the performance of a rules-based strategy which allocates 60 per cent into a bond index and 40 per cent into an US equity index, that distributes resources among the top 5 US equities in terms of market capitalisation.

Such a strategy aims to deliver superior risk-adjusted returns and is aligned with the Korea Financial Services Commission’s latest batch on eligible pension plan types issued in August 2022. Indeed, due to its nature and composition, the Shinhan SOL US TOP5 40 Blended ETF (447620.KS) is now eligible to be part of Defined contribution (DC) and Individual retirement pension plan (IRP) investable ETFs.

Timo Pfeiffer, Chief Markets Officer at Solactive, says: “The product’s objective is to offer diversification in the allocation of resources, which can help to achieve a more stable performance. We are very pleased that Shinhan Asset Management chose Solactive to launch such an innovative instrument. This launch with Shinhan serves as a great affirmation of our ambition to bring new and innovative products to Korean investors, with an excellent quality of services.”

Jung Hyun Kim, Head of SOL ETF Center at Shinhan Asset Management, says: “SOL U.S. Top5 bond-mixed 40 ETF (Shinhan SOL US TOP5 40 Blended ETF, A447620) is the only bond-mixed ETF listed in Korean stock market that contains 40 per cent of U.S. Stocks (Tesla, Microsoft, Apple, Google, Amazon) and 60 per cent of Korean bond. We are pleased to launch the product that can contribute to the asset growth as well as investment opportunities to Korean investors by co-operating with Solactive. We look forward to co-work with Solactive to develop innovative and investable ETF products in near future. ”

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