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Is WisdomTree Europe SmallCap Dividend ETF (DFE) a Strong ETF Right Now?
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The WisdomTree Europe SmallCap Dividend ETF (DFE - Free Report) made its debut on 06/16/2006, and is a smart beta exchange traded fund that provides broad exposure to the European Equity ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
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.
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.
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
DFE is managed by Wisdomtree, and this fund has amassed over $212.32 million, which makes it one of the average sized ETFs in the European Equity ETFs. DFE seeks to match the performance of the WisdomTree Europe SmallCap Dividend Index before fees and expenses.
The WisdomTree Europe SmallCap Dividend Index is a fundamentally weighted index that measures the performance of the small-capitalization segment of the European dividend-paying market.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.58% for DFE, making it on par with most peer products in the space.
DFE's 12-month trailing dividend yield is 5.23%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
Taking into account individual holdings, Ssab Ab (SSABA) accounts for about 3.08% of the fund's total assets, followed by D/s Norden (DNORD) and Sydbank A/s (SYDB).
DFE's top 10 holdings account for about 13.99% of its total assets under management.
Performance and Risk
So far this year, DFE return is roughly 9.80%, and is up about 16.86% in the last one year (as of 07/17/2023). During this past 52-week period, the fund has traded between $44.46 and $61.12.
DFE has a beta of 1.14 and standard deviation of 20.80% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 297 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Europe SmallCap Dividend ETF is not a suitable option for investors seeking to outperform the European Equity ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares MSCI Eurozone ETF (EZU - Free Report) tracks MSCI EMU Index and the Vanguard FTSE Europe ETF (VGK - Free Report) tracks FTSE Developed Europe All Cap Index. IShares MSCI Eurozone ETF has $8.45 billion in assets, Vanguard FTSE Europe ETF has $19.32 billion. EZU has an expense ratio of 0.52% and VGK charges 0.11%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the European Equity 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 Europe SmallCap Dividend ETF (DFE) a Strong ETF Right Now?
The WisdomTree Europe SmallCap Dividend ETF (DFE - Free Report) made its debut on 06/16/2006, and is a smart beta exchange traded fund that provides broad exposure to the European Equity ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
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.
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.
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
DFE is managed by Wisdomtree, and this fund has amassed over $212.32 million, which makes it one of the average sized ETFs in the European Equity ETFs. DFE seeks to match the performance of the WisdomTree Europe SmallCap Dividend Index before fees and expenses.
The WisdomTree Europe SmallCap Dividend Index is a fundamentally weighted index that measures the performance of the small-capitalization segment of the European dividend-paying market.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.58% for DFE, making it on par with most peer products in the space.
DFE's 12-month trailing dividend yield is 5.23%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
Taking into account individual holdings, Ssab Ab (SSABA) accounts for about 3.08% of the fund's total assets, followed by D/s Norden (DNORD) and Sydbank A/s (SYDB).
DFE's top 10 holdings account for about 13.99% of its total assets under management.
Performance and Risk
So far this year, DFE return is roughly 9.80%, and is up about 16.86% in the last one year (as of 07/17/2023). During this past 52-week period, the fund has traded between $44.46 and $61.12.
DFE has a beta of 1.14 and standard deviation of 20.80% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 297 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Europe SmallCap Dividend ETF is not a suitable option for investors seeking to outperform the European Equity ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares MSCI Eurozone ETF (EZU - Free Report) tracks MSCI EMU Index and the Vanguard FTSE Europe ETF (VGK - Free Report) tracks FTSE Developed Europe All Cap Index. IShares MSCI Eurozone ETF has $8.45 billion in assets, Vanguard FTSE Europe ETF has $19.32 billion. EZU has an expense ratio of 0.52% and VGK charges 0.11%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the European Equity 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.