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Is WisdomTree U.S. High Dividend ETF (DHS) a Strong ETF Right Now?
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Designed to provide broad exposure to the Style Box - Large Cap Value category of the market, the WisdomTree U.S. High Dividend ETF (DHS - Free Report) is a smart beta exchange traded fund launched on 06/16/2006.
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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
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.
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
DHS is managed by Wisdomtree, and this fund has amassed over $1.16 billion, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. DHS 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
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Operating expenses on an annual basis are 0.38% for this ETF, which makes it on par with most peer products in the space.
DHS's 12-month trailing dividend yield is 4.32%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Energy sector - about 22.30% of the portfolio. Financials and Utilities round out the top three.
Taking into account individual holdings, Exxon Mobil Corp (XOM - Free Report) accounts for about 5.82% of the fund's 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
The ETF has lost about -6.17% and is up about 4.49% so far this year and in the past one year (as of 09/29/2023), respectively. DHS has traded between $75.81 and $89.39 during this last 52-week period.
DHS has a beta of 0.81 and standard deviation of 15.04% for the trailing three-year period, which makes the fund 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 $48.34 billion in assets, Vanguard Value ETF has $98.24 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.
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Is WisdomTree U.S. High Dividend ETF (DHS) a Strong ETF Right Now?
Designed to provide broad exposure to the Style Box - Large Cap Value category of the market, the WisdomTree U.S. High Dividend ETF (DHS - Free Report) is a smart beta exchange traded fund launched on 06/16/2006.
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.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
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.
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
DHS is managed by Wisdomtree, and this fund has amassed over $1.16 billion, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. DHS 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
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Operating expenses on an annual basis are 0.38% for this ETF, which makes it on par with most peer products in the space.
DHS's 12-month trailing dividend yield is 4.32%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Energy sector - about 22.30% of the portfolio. Financials and Utilities round out the top three.
Taking into account individual holdings, Exxon Mobil Corp (XOM - Free Report) accounts for about 5.82% of the fund's 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
The ETF has lost about -6.17% and is up about 4.49% so far this year and in the past one year (as of 09/29/2023), respectively. DHS has traded between $75.81 and $89.39 during this last 52-week period.
DHS has a beta of 0.81 and standard deviation of 15.04% for the trailing three-year period, which makes the fund 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 $48.34 billion in assets, Vanguard Value ETF has $98.24 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.