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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?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by Wisdomtree, and has been able to amass over $1.03 billion, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. DTD, before fees and expenses, seeks to match the performance of the WisdomTree U.S. Dividend Index.
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
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.
Operating expenses on an annual basis are 0.28% for this ETF, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 2.09%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
For DTD, it has heaviest allocation in the Information Technology sector --about 21.40% of the portfolio --while Financials and Healthcare round out the top three.
Looking at individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 3.95% of total assets, followed by Apple Inc (AAPL - Free Report) and Exxon Mobil Corp (XOM - Free Report) .
The top 10 holdings account for about 25.57% of total assets under management.
Performance and Risk
So far this year, DTD has lost about -4.39%, and it's up approximately 17.22% in the last one year (as of 03/08/2022). During this past 52-week period, the fund has traded between $54.65 and $65.53.
DTD has a beta of 0.96 and standard deviation of 22.01% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 642 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. Total Dividend ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
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 $55.36 billion in assets, Vanguard Value ETF has $91.71 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?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by Wisdomtree, and has been able to amass over $1.03 billion, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. DTD, before fees and expenses, seeks to match the performance of the WisdomTree U.S. Dividend Index.
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
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.
Operating expenses on an annual basis are 0.28% for this ETF, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 2.09%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
For DTD, it has heaviest allocation in the Information Technology sector --about 21.40% of the portfolio --while Financials and Healthcare round out the top three.
Looking at individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 3.95% of total assets, followed by Apple Inc (AAPL - Free Report) and Exxon Mobil Corp (XOM - Free Report) .
The top 10 holdings account for about 25.57% of total assets under management.
Performance and Risk
So far this year, DTD has lost about -4.39%, and it's up approximately 17.22% in the last one year (as of 03/08/2022). During this past 52-week period, the fund has traded between $54.65 and $65.53.
DTD has a beta of 0.96 and standard deviation of 22.01% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 642 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. Total Dividend ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
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 $55.36 billion in assets, Vanguard Value ETF has $91.71 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.