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.
Should WisdomTree U.S. MidCap ETF (EZM) Be on Your Investing Radar?
Read MoreHide Full Article
Looking for broad exposure to the Mid Cap Value segment of the US equity market? You should consider the WisdomTree U.S. MidCap ETF (EZM - Free Report) , a passively managed exchange traded fund launched on 02/23/2007.
The fund is sponsored by Wisdomtree. It has amassed assets over $816.52 million, making it one of the average sized ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. Thus they have a nice balance of growth potential and stability.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
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.
Annual operating expenses for this ETF are 0.38%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.21%.
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.
This ETF has heaviest allocation to the Industrials sector--about 20% of the portfolio. Financials and Consumer Discretionary round out the top three.
Looking at individual holdings, American Airlines Group Inc (AAL - Free Report) accounts for about 0.88% of total assets, followed by Toll Brothers Inc (TOL - Free Report) and United States Steel Corp (X - Free Report) .
The top 10 holdings account for about 6.98% of total assets under management.
Performance and Risk
EZM seeks to match the performance of the WisdomTree U.S. MidCap Earnings Index before fees and expenses. The WisdomTree U.S. MidCap Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the mid-capitalization segment of the U.S. Stock Market.
The ETF return is roughly 3.85% so far this year and was up about 26.19% in the last one year (as of 03/21/2024). In the past 52-week period, it has traded between $47.01 and $59.60.
The ETF has a beta of 1.22 and standard deviation of 21.32% for the trailing three-year period, making it a medium risk choice in the space. With about 552 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. MidCap ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, EZM is a reasonable option for those seeking exposure to the Style Box - Mid Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell Mid-Cap Value ETF (IWS - Free Report) and the Vanguard Mid-Cap Value ETF (VOE - Free Report) track a similar index. While iShares Russell Mid-Cap Value ETF has $13.84 billion in assets, Vanguard Mid-Cap Value ETF has $16.43 billion. IWS has an expense ratio of 0.23% and VOE charges 0.07%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
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
Should WisdomTree U.S. MidCap ETF (EZM) Be on Your Investing Radar?
Looking for broad exposure to the Mid Cap Value segment of the US equity market? You should consider the WisdomTree U.S. MidCap ETF (EZM - Free Report) , a passively managed exchange traded fund launched on 02/23/2007.
The fund is sponsored by Wisdomtree. It has amassed assets over $816.52 million, making it one of the average sized ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. Thus they have a nice balance of growth potential and stability.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
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.
Annual operating expenses for this ETF are 0.38%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.21%.
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.
This ETF has heaviest allocation to the Industrials sector--about 20% of the portfolio. Financials and Consumer Discretionary round out the top three.
Looking at individual holdings, American Airlines Group Inc (AAL - Free Report) accounts for about 0.88% of total assets, followed by Toll Brothers Inc (TOL - Free Report) and United States Steel Corp (X - Free Report) .
The top 10 holdings account for about 6.98% of total assets under management.
Performance and Risk
EZM seeks to match the performance of the WisdomTree U.S. MidCap Earnings Index before fees and expenses. The WisdomTree U.S. MidCap Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the mid-capitalization segment of the U.S. Stock Market.
The ETF return is roughly 3.85% so far this year and was up about 26.19% in the last one year (as of 03/21/2024). In the past 52-week period, it has traded between $47.01 and $59.60.
The ETF has a beta of 1.22 and standard deviation of 21.32% for the trailing three-year period, making it a medium risk choice in the space. With about 552 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. MidCap ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, EZM is a reasonable option for those seeking exposure to the Style Box - Mid Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell Mid-Cap Value ETF (IWS - Free Report) and the Vanguard Mid-Cap Value ETF (VOE - Free Report) track a similar index. While iShares Russell Mid-Cap Value ETF has $13.84 billion in assets, Vanguard Mid-Cap Value ETF has $16.43 billion. IWS has an expense ratio of 0.23% and VOE charges 0.07%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
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.