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Is WisdomTree International Hedged Quality Dividend Growth ETF (IHDG) a Strong ETF Right Now?
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Designed to provide broad exposure to the Broad Developed World ETFs category of the market, the WisdomTree International Hedged Quality Dividend Growth ETF (IHDG - Free Report) is a smart beta exchange traded fund launched on 05/07/2014.
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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer 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.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
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. IHDG has been able to amass assets over $1.10 billion, making it one of the larger ETFs in the Broad Developed World ETFs. IHDG seeks to match the performance of the WisdomTree International Hedged Quality Dividend Growth Index before fees and expenses.
The WisdomTree International Hedged Quality Dividend Growth Index is designed to provide exposure to the developed market companies while at the same time neutralizing exposure to fluctuations between the value of foreign currencies and the U.S. dollar.
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 0.58% for this ETF, which makes it one of the more expensive products in the space.
It has a 12-month trailing dividend yield of 2.30%.
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.
Looking at individual holdings, Rio Tinto Plc (RIO - Free Report) accounts for about 6.45% of total assets, followed by Bhp Group Ltd (BHP - Free Report) and Unilever Plc (ULVR).
Its top 10 holdings account for approximately 42.9% of IHDG's total assets under management.
Performance and Risk
The ETF has added about 16.81% and was up about 27.19% so far this year and in the past one year (as of 09/16/2021), respectively. IHDG has traded between $35.11 and $46.44 during this last 52-week period.
The fund has a beta of 0.69 and standard deviation of 19.29% for the trailing three-year period, which makes IHDG a medium risk choice in this particular space. With about 455 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree International Hedged Quality Dividend Growth ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core Dividend Growth ETF (DGRO - Free Report) tracks Morningstar US Dividend Growth Index and the Vanguard Dividend Appreciation ETF (VIG - Free Report) tracks NASDAQ US Dividend Achievers Select Index. IShares Core Dividend Growth ETF has $20.50 billion in assets, Vanguard Dividend Appreciation ETF has $62.39 billion. DGRO has an expense ratio of 0.08% and VIG charges 0.06%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed World 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 International Hedged Quality Dividend Growth ETF (IHDG) a Strong ETF Right Now?
Designed to provide broad exposure to the Broad Developed World ETFs category of the market, the WisdomTree International Hedged Quality Dividend Growth ETF (IHDG - Free Report) is a smart beta exchange traded fund launched on 05/07/2014.
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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer 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.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
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. IHDG has been able to amass assets over $1.10 billion, making it one of the larger ETFs in the Broad Developed World ETFs. IHDG seeks to match the performance of the WisdomTree International Hedged Quality Dividend Growth Index before fees and expenses.
The WisdomTree International Hedged Quality Dividend Growth Index is designed to provide exposure to the developed market companies while at the same time neutralizing exposure to fluctuations between the value of foreign currencies and the U.S. dollar.
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 0.58% for this ETF, which makes it one of the more expensive products in the space.
It has a 12-month trailing dividend yield of 2.30%.
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.
Looking at individual holdings, Rio Tinto Plc (RIO - Free Report) accounts for about 6.45% of total assets, followed by Bhp Group Ltd (BHP - Free Report) and Unilever Plc (ULVR).
Its top 10 holdings account for approximately 42.9% of IHDG's total assets under management.
Performance and Risk
The ETF has added about 16.81% and was up about 27.19% so far this year and in the past one year (as of 09/16/2021), respectively. IHDG has traded between $35.11 and $46.44 during this last 52-week period.
The fund has a beta of 0.69 and standard deviation of 19.29% for the trailing three-year period, which makes IHDG a medium risk choice in this particular space. With about 455 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree International Hedged Quality Dividend Growth ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core Dividend Growth ETF (DGRO - Free Report) tracks Morningstar US Dividend Growth Index and the Vanguard Dividend Appreciation ETF (VIG - Free Report) tracks NASDAQ US Dividend Achievers Select Index. IShares Core Dividend Growth ETF has $20.50 billion in assets, Vanguard Dividend Appreciation ETF has $62.39 billion. DGRO has an expense ratio of 0.08% and VIG charges 0.06%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed World 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.