We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is WisdomTree U.S. LargeCap Dividend ETF (DLN) a Strong ETF Right Now?
Read MoreHide Full Article
Launched on 06/16/2006, the WisdomTree U.S. LargeCap Dividend ETF (DLN - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Because the fund has amassed over $3.36 billion, this makes it one of the average sized ETFs in the Style Box - Large Cap Value. DLN is managed by Wisdomtree. DLN seeks to match the performance of the WisdomTree U.S. LargeCap Dividend Index before fees and expenses.
The WisdomTree U.S. LargeCap Dividend Index is a fundamentally weighted index that measures the performance of the large-capitalization segment of the U.S. dividend-paying market.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for DLN are 0.28%, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 2.01%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
For DLN, it has heaviest allocation in the Information Technology sector --about 23.50% of the portfolio --while Healthcare and Consumer Staples round out the top three.
Looking at individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 6.34% of total assets, followed by Apple Inc (AAPL - Free Report) and Johnson & Johnson (JNJ - Free Report) .
The top 10 holdings account for about 29.38% of total assets under management.
Performance and Risk
So far this year, DLN has lost about -0.06%, and was up about 24.09% in the last one year (as of 01/17/2022). During this past 52-week period, the fund has traded between $53.03 and $66.73.
The ETF has a beta of 0.96 and standard deviation of 21.98% for the trailing three-year period, making it a medium risk choice in the space. With about 296 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. LargeCap Dividend ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell 1000 Value ETF (IWD - Free Report) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $59.53 billion in assets, Vanguard Value ETF has $93.92 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Value.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is WisdomTree U.S. LargeCap Dividend ETF (DLN) a Strong ETF Right Now?
Launched on 06/16/2006, the WisdomTree U.S. LargeCap Dividend ETF (DLN - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Because the fund has amassed over $3.36 billion, this makes it one of the average sized ETFs in the Style Box - Large Cap Value. DLN is managed by Wisdomtree. DLN seeks to match the performance of the WisdomTree U.S. LargeCap Dividend Index before fees and expenses.
The WisdomTree U.S. LargeCap Dividend Index is a fundamentally weighted index that measures the performance of the large-capitalization segment of the U.S. dividend-paying market.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for DLN are 0.28%, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 2.01%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
For DLN, it has heaviest allocation in the Information Technology sector --about 23.50% of the portfolio --while Healthcare and Consumer Staples round out the top three.
Looking at individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 6.34% of total assets, followed by Apple Inc (AAPL - Free Report) and Johnson & Johnson (JNJ - Free Report) .
The top 10 holdings account for about 29.38% of total assets under management.
Performance and Risk
So far this year, DLN has lost about -0.06%, and was up about 24.09% in the last one year (as of 01/17/2022). During this past 52-week period, the fund has traded between $53.03 and $66.73.
The ETF has a beta of 0.96 and standard deviation of 21.98% for the trailing three-year period, making it a medium risk choice in the space. With about 296 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. LargeCap Dividend ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell 1000 Value ETF (IWD - Free Report) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $59.53 billion in assets, Vanguard Value ETF has $93.92 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Value.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.