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Is WisdomTree U.S. Total Dividend ETF (DTD) a Strong ETF Right Now?
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The WisdomTree U.S. Total Dividend ETF (DTD - Free Report) was launched on 06/16/2006, and is a smart beta exchange traded fund designed to offer 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.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
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.
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. DTD has been able to amass assets over $978.18 million, making it one of the average sized ETFs in the Style Box - Large Cap Value. DTD seeks to match the performance of the WisdomTree U.S. Dividend Index before fees and expenses.
The WisdomTree U.S. Dividend Index is a fundamentally-weighted index that defines the dividend-paying portion of the U.S. equity market.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.28%.
DTD's 12-month trailing dividend yield is 2.38%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
DTD's heaviest allocation is in the Information Technology sector, which is about 19.90% of the portfolio. Its Financials and Consumer Staples round out the top three.
Taking into account individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 5.34% of the fund's total assets, followed by Apple Inc (AAPL - Free Report) and Johnson & Johnson (JNJ - Free Report) .
The top 10 holdings account for about 26.45% of total assets under management.
Performance and Risk
Year-to-date, the WisdomTree U.S. Total Dividend ETF has added about 21.49% so far, and is up roughly 33.47% over the last 12 months (as of 10/27/2021). DTD has traded between $90.68 and $123.90 in this past 52-week period.
DTD has a beta of 0.98 and standard deviation of 22.37% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 665 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. Total 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 $56.80 billion in assets, Vanguard Value ETF has $87.69 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. Total Dividend ETF (DTD) a Strong ETF Right Now?
The WisdomTree U.S. Total Dividend ETF (DTD - Free Report) was launched on 06/16/2006, and is a smart beta exchange traded fund designed to offer 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.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
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.
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. DTD has been able to amass assets over $978.18 million, making it one of the average sized ETFs in the Style Box - Large Cap Value. DTD seeks to match the performance of the WisdomTree U.S. Dividend Index before fees and expenses.
The WisdomTree U.S. Dividend Index is a fundamentally-weighted index that defines the dividend-paying portion of the U.S. equity market.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.28%.
DTD's 12-month trailing dividend yield is 2.38%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
DTD's heaviest allocation is in the Information Technology sector, which is about 19.90% of the portfolio. Its Financials and Consumer Staples round out the top three.
Taking into account individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 5.34% of the fund's total assets, followed by Apple Inc (AAPL - Free Report) and Johnson & Johnson (JNJ - Free Report) .
The top 10 holdings account for about 26.45% of total assets under management.
Performance and Risk
Year-to-date, the WisdomTree U.S. Total Dividend ETF has added about 21.49% so far, and is up roughly 33.47% over the last 12 months (as of 10/27/2021). DTD has traded between $90.68 and $123.90 in this past 52-week period.
DTD has a beta of 0.98 and standard deviation of 22.37% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 665 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. Total 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 $56.80 billion in assets, Vanguard Value ETF has $87.69 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.