TAIPEI (Taiwan News) — Taiwan's Exchange Traded Funds saw record growth last year, expanding to 66 funds and attracting over 10.2 million investors, a 70% annual jump.
An ETF is an investment fund issued by management firms that tracks a specific market index. For example, Taiwan's Yuanta/P-shares Taiwan Top 50 ETF (0050) invests in the 50 largest Taiwanese companies listed on the stock market.
High-dividend ETFs fueled a surge in subscriptions during the first half of last year. In the second half, market pullbacks and fluctuations led to declining dividend payouts for some ETFs, reducing their appeal, per CNA.
By purchasing shares, an investor acquires a small piece of ownership in the company, becoming a shareholder. Profit given back to shareholders in the form of cash or stocks are dividends.
Investment trust data shows that Capital Tip Taiwan Select High Dividend ETF (00919) gained 616,800 beneficiaries in 2024, making it the most popular ETF. Fubon FTSE TWSE Taiwan 50 ETF (006208) and Yuanta/P-shares Taiwan Dividend Plus ETF (0056) followed, with 309,900 and 268,500 new beneficiaries, respectively.
Among the top 10 ETFs with record-high beneficiaries, seven were high-dividend types, including six with quarterly distributions. High-dividend ETFs with payout features continue to attract strong investor interest.
Taiwanese stock ETFs distribute dividends annually, semi-annually, quarterly, or bi-monthly. Monthly distributions, introduced in 2023, have proven particularly popular with income-focused investors, according to Yahoo stocks.
Monthly dividend ETFs are suitable for investors seeking stable cash flow. For example, someone investing in 100 lots (equivalent to 100,000 shares in the Taiwanese market) of monthly dividend ETF 00929, with a payout of NT$0.2 per share, would receive NT$200 (US$6) per lot. This adds up to NT$20,000 in monthly dividends.