Kiwoom US High-Dividend AI Tech ETF - 70% Dividend Stocks + 30% Big Tech Strategy
π― An Alternative to SCHD: Kiwoom US High-Dividend AI Tech
For those considering US high-dividend ETF investments, the first ETF worth comparing to SCHD is Kiwoom US High-Dividend AI Tech.
The core strategy is simple:
- 70% US high-dividend stocks
- 30% US Big Tech
A structure that lets you invest in both dividend stocks and growth stocks at once.
π Portfolio Construction
US AI Tech (30%)
The Big Tech names we all know well. Composed of 10 stocks including Apple, Microsoft, NVIDIA, etc.
US High-Dividend Portfolio (70%)
Stock selection differs from SCHD.
| Category | SCHD | Kiwoom High-Div AI Tech |
|---|---|---|
| Selection Criteria | Dividend Growth | Dividend Yield |
| Momentum Filter | None | Excludes bottom 25% |
| Number of Stocks | ~100 | 20 stocks |
Stocks are selected based on dividend yield rather than dividend growth. To exclude cases where yields are high due to falling stock prices, bottom 25% momentum stocks are excluded.
Final portfolio: 10 Big Tech + 20 US High-Dividend = 30 stocks total
π‘ The Power of Auto-Rebalancing
"Why not just buy 70% dividend stocks and 30% Big Tech separately?"
This question comes up a lot. Monthly automatic rebalancing to maintain the 7:3 ratio is a structurally huge advantage.
Why Is Auto-Rebalancing Important?
In the medium to long term, Big Tech will likely outperform high-dividend stocks. This naturally tilts the portfolio toward Big Tech.
Auto-rebalancing results in:
- π Selling Big Tech
- π° Monthly increasing high-dividend stock allocation
This is not easy to do manually, and the direct and indirect costs of trading are significant.
β οΈ Cause of Early Underperformance
Kiwoom US High-Dividend AI Tech received decent inflows at listing. Those who bought immediately may have been puzzled by the poor early performance.
Reason: Financial Stocks
The US high-dividend portfolio has relatively high financial sector exposure. On October 16, concerns about US regional bank failures surfaced, causing a significant correction in US bank stocks.
| Index/ETF | Daily Decline |
|---|---|
| S&P 500 Financial | -3% |
| KRE (US Regional Banks ETF) | Over -6% |
S&P 500 was rising while Kiwoom US High-Dividend AI Tech was fallingβdue to financial stock exposure.
π Post-Listing Performance
Still, post-listing performance shows +4.24%.
While the listing timing was somewhat unfortunate in the short term, from a long-term perspective:
- β Strategy combining Big Tech and high-dividend stocks
- β Monthly auto-rebalancing
- β Balance between growth and stability
I think it's a solid ETF concept.
π― Recommended For
-
Those uncomfortable investing only in SCHD
- Adding Big Tech to dividend stocks for growth potential
-
Those finding it cumbersome to manage Big Tech and dividend stocks separately
- Convenient management with auto-rebalancing
-
Those wanting yield-based high-dividend stocks
- Different approach from SCHD (dividend growth)
π Investment Considerations
- High financial sector weight makes it sensitive to financial sector issues
- Small AUM due to recent listing
- 30% Big Tech means tech stock volatility exposure
However, the high-dividend + Big Tech combination can create a more balanced portfolio than investing only in SCHD.
In the next article, I'll introduce another alternative: the RISE US High-Dividend Dow Jones Top 10 ETF.