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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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The WisdomTree Emerging Markets High Dividend ETF (DEM - Free Report) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs 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 work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
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.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
Managed by Wisdomtree, DEM has amassed assets over $2.09 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for DEM are 0.63%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 5.88%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Vale Sa (VALE3) accounts for about 8.86% of the fund's total assets, followed by Petroleo Brasileiro Sa (PETR3) and China Construction Bank Corp H.
Its top 10 holdings account for approximately 28.18% of DEM's total assets under management.
Performance and Risk
The ETF has lost about -0.41% so far this year and is up about 4.05% in the last one year (as of 03/21/2022). In the past 52-week period, it has traded between $40.62 and $47.61.
DEM has a beta of 0.79 and standard deviation of 22.22% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 493 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is a reasonable option for investors seeking to outperform the Broad Emerging Market ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core MSCI Emerging Markets ETF (IEMG - Free Report) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO - Free Report) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $71.65 billion in assets, Vanguard FTSE Emerging Markets ETF has $77.73 billion. IEMG has an expense ratio of 0.11% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Emerging Market ETFs.
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.
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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
The WisdomTree Emerging Markets High Dividend ETF (DEM - Free Report) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs 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 work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
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.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
Managed by Wisdomtree, DEM has amassed assets over $2.09 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for DEM are 0.63%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 5.88%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Vale Sa (VALE3) accounts for about 8.86% of the fund's total assets, followed by Petroleo Brasileiro Sa (PETR3) and China Construction Bank Corp H.
Its top 10 holdings account for approximately 28.18% of DEM's total assets under management.
Performance and Risk
The ETF has lost about -0.41% so far this year and is up about 4.05% in the last one year (as of 03/21/2022). In the past 52-week period, it has traded between $40.62 and $47.61.
DEM has a beta of 0.79 and standard deviation of 22.22% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 493 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is a reasonable option for investors seeking to outperform the Broad Emerging Market ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core MSCI Emerging Markets ETF (IEMG - Free Report) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO - Free Report) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $71.65 billion in assets, Vanguard FTSE Emerging Markets ETF has $77.73 billion. IEMG has an expense ratio of 0.11% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Emerging Market ETFs.
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.