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Is WisdomTree U.S. High Dividend ETF (DHS) a Strong ETF Right Now?
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A smart beta exchange traded fund, the WisdomTree U.S. High Dividend ETF (DHS - Free Report) debuted on 06/16/2006, and offers broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
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
The fund is managed by Wisdomtree. DHS has been able to amass assets over $1.16 billion, making it one of the average sized ETFs in the Style Box - Large Cap Value. This particular fund seeks to match the performance of the WisdomTree U.S. High Dividend Index before fees and expenses.
The WisdomTree U.S. High Dividend Index is a fundamentally weighted index that measures the performance of companies with high dividend yields selected from the WisdomTree Dividend Index.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.38%.
The fund has a 12-month trailing dividend yield of 4.23%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
DHS's heaviest allocation is in the Energy sector, which is about 19.90% of the portfolio. Its Financials and Utilities round out the top three.
Looking at individual holdings, Exxon Mobil Corp (XOM - Free Report) accounts for about 5.82% of total assets, followed by Abbvie Inc (ABBV - Free Report) and Chevron Corp (CVX - Free Report) .
The top 10 holdings account for about 40.02% of total assets under management.
Performance and Risk
So far this year, DHS has lost about -4.18%, and is up roughly 3.04% in the last one year (as of 07/13/2023). During this past 52-week period, the fund has traded between $75.81 and $89.39.
The ETF has a beta of 0.81 and standard deviation of 15.30% for the trailing three-year period, making it a medium risk choice in the space. With about 392 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. High Dividend ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
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 $51.45 billion in assets, Vanguard Value ETF has $100.02 billion. IWD has an expense ratio of 0.18% 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.
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Is WisdomTree U.S. High Dividend ETF (DHS) a Strong ETF Right Now?
A smart beta exchange traded fund, the WisdomTree U.S. High Dividend ETF (DHS - Free Report) debuted on 06/16/2006, and offers broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
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
The fund is managed by Wisdomtree. DHS has been able to amass assets over $1.16 billion, making it one of the average sized ETFs in the Style Box - Large Cap Value. This particular fund seeks to match the performance of the WisdomTree U.S. High Dividend Index before fees and expenses.
The WisdomTree U.S. High Dividend Index is a fundamentally weighted index that measures the performance of companies with high dividend yields selected from the WisdomTree Dividend Index.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.38%.
The fund has a 12-month trailing dividend yield of 4.23%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
DHS's heaviest allocation is in the Energy sector, which is about 19.90% of the portfolio. Its Financials and Utilities round out the top three.
Looking at individual holdings, Exxon Mobil Corp (XOM - Free Report) accounts for about 5.82% of total assets, followed by Abbvie Inc (ABBV - Free Report) and Chevron Corp (CVX - Free Report) .
The top 10 holdings account for about 40.02% of total assets under management.
Performance and Risk
So far this year, DHS has lost about -4.18%, and is up roughly 3.04% in the last one year (as of 07/13/2023). During this past 52-week period, the fund has traded between $75.81 and $89.39.
The ETF has a beta of 0.81 and standard deviation of 15.30% for the trailing three-year period, making it a medium risk choice in the space. With about 392 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. High Dividend ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
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 $51.45 billion in assets, Vanguard Value ETF has $100.02 billion. IWD has an expense ratio of 0.18% 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.