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Is WisdomTree Cloud Computing ETF (WCLD) a Strong ETF Right Now?
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The WisdomTree Cloud Computing ETF (WCLD - Free Report) was launched on 09/06/2019, and is a smart beta exchange traded fund designed to offer broad exposure to the Technology ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
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.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
WCLD is managed by Wisdomtree, and this fund has amassed over $865.27 million, which makes it one of the average sized ETFs in the Technology ETFs. WCLD, before fees and expenses, seeks to match the performance of the BVP NASDAQ EMERGING CLOUD INDEX .
The BVP Nasdaq Emerging Cloud Index is an equally weighted Index, designed to measure the performance of emerging public companies focused on delivering cloud-based software to customers.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
With one of the cheaper products in the space, this ETF has annual operating expenses of 0.45%.
The fund has a 12-month trailing dividend yield of 0%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Representing 95.60% of the portfolio, the fund has heaviest allocation to the Information Technology sector.
Looking at individual holdings, Mimecast Ltd accounts for about 3.02% of total assets, followed by Datadog Inc - Class A (DDOG - Free Report) and Tenable Holdings Inc (TENB - Free Report) .
WCLD's top 10 holdings account for about 25.51% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree Cloud Computing ETF has lost about -18.64% so far, and is down about -22.30% over the last 12 months (as of 03/03/2022). WCLD has traded between $37.64 and $65.33 in this past 52-week period.
The ETF has a beta of 1.21 and standard deviation of 36.96% for the trailing three-year period. With about 58 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Cloud Computing ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Global X Cloud Computing ETF (CLOU - Free Report) tracks INDXX GLOBAL CLOUD COMPUTING INDEX and the First Trust Cloud Computing ETF (SKYY - Free Report) tracks ISE Cloud Computing Index. Global X Cloud Computing ETF has $869.08 million in assets, First Trust Cloud Computing ETF has $5.24 billion. CLOU has an expense ratio of 0.68% and SKYY charges 0.60%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology 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 Cloud Computing ETF (WCLD) a Strong ETF Right Now?
The WisdomTree Cloud Computing ETF (WCLD - Free Report) was launched on 09/06/2019, and is a smart beta exchange traded fund designed to offer broad exposure to the Technology ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
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.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
WCLD is managed by Wisdomtree, and this fund has amassed over $865.27 million, which makes it one of the average sized ETFs in the Technology ETFs. WCLD, before fees and expenses, seeks to match the performance of the BVP NASDAQ EMERGING CLOUD INDEX .
The BVP Nasdaq Emerging Cloud Index is an equally weighted Index, designed to measure the performance of emerging public companies focused on delivering cloud-based software to customers.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
With one of the cheaper products in the space, this ETF has annual operating expenses of 0.45%.
The fund has a 12-month trailing dividend yield of 0%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Representing 95.60% of the portfolio, the fund has heaviest allocation to the Information Technology sector.
Looking at individual holdings, Mimecast Ltd accounts for about 3.02% of total assets, followed by Datadog Inc - Class A (DDOG - Free Report) and Tenable Holdings Inc (TENB - Free Report) .
WCLD's top 10 holdings account for about 25.51% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree Cloud Computing ETF has lost about -18.64% so far, and is down about -22.30% over the last 12 months (as of 03/03/2022). WCLD has traded between $37.64 and $65.33 in this past 52-week period.
The ETF has a beta of 1.21 and standard deviation of 36.96% for the trailing three-year period. With about 58 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Cloud Computing ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Global X Cloud Computing ETF (CLOU - Free Report) tracks INDXX GLOBAL CLOUD COMPUTING INDEX and the First Trust Cloud Computing ETF (SKYY - Free Report) tracks ISE Cloud Computing Index. Global X Cloud Computing ETF has $869.08 million in assets, First Trust Cloud Computing ETF has $5.24 billion. CLOU has an expense ratio of 0.68% and SKYY charges 0.60%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology 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.