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Is WisdomTree India Earnings ETF (EPI) a Strong ETF Right Now?
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Launched on 02/22/2008, the WisdomTree India Earnings ETF (EPI - Free Report) is a smart beta exchange traded fund offering broad exposure to the Asia-Pacific (Emerging) ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
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.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
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
EPI is managed by Wisdomtree, and this fund has amassed over $840.50 million, which makes it one of the larger ETFs in the Asia-Pacific (Emerging) ETFs. EPI seeks to match the performance of the WisdomTree India Earnings Index before fees and expenses.
The WisdomTree India Earnings Index is a fundamentally weighted index that measures the performance of companies incorporated and traded in India that are profitable and that are eligible to be purchased by foreign investors as of the index measurement date. Weighted Index based on their earnings in their fiscal year prior to the Index measurement date adjusted for foreign investors.
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 most expensive products in the space, this ETF has annual operating expenses of 0.84%.
It's 12-month trailing dividend yield comes in at 1.28%.
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.
Taking into account individual holdings, Reliance Industries Ltd (RIL) accounts for about 7.79% of the fund's total assets, followed by Infosys Ltd and Housing Development Finance Co (HDFC).
EPI's top 10 holdings account for about 35.59% of its total assets under management.
Performance and Risk
The ETF has lost about -9.50% so far this year and is up roughly 6.57% in the last one year (as of 03/09/2022). In the past 52-week period, it has traded between $29.64 and $39.26.
EPI has a beta of 0.79 and standard deviation of 27.05% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 473 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree India Earnings ETF is a reasonable option for investors seeking to outperform the Asia-Pacific (Emerging) ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares India 50 ETF (INDY - Free Report) tracks Nifty 50 Index and the iShares MSCI India ETF (INDA - Free Report) tracks MSCI India Total Return Index. IShares India 50 ETF has $603.89 million in assets, iShares MSCI India ETF has $5.21 billion. INDY has an expense ratio of 0.90% and INDA charges 0.65%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Asia-Pacific (Emerging) 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 India Earnings ETF (EPI) a Strong ETF Right Now?
Launched on 02/22/2008, the WisdomTree India Earnings ETF (EPI - Free Report) is a smart beta exchange traded fund offering broad exposure to the Asia-Pacific (Emerging) ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
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.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
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
EPI is managed by Wisdomtree, and this fund has amassed over $840.50 million, which makes it one of the larger ETFs in the Asia-Pacific (Emerging) ETFs. EPI seeks to match the performance of the WisdomTree India Earnings Index before fees and expenses.
The WisdomTree India Earnings Index is a fundamentally weighted index that measures the performance of companies incorporated and traded in India that are profitable and that are eligible to be purchased by foreign investors as of the index measurement date. Weighted Index based on their earnings in their fiscal year prior to the Index measurement date adjusted for foreign investors.
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 most expensive products in the space, this ETF has annual operating expenses of 0.84%.
It's 12-month trailing dividend yield comes in at 1.28%.
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.
Taking into account individual holdings, Reliance Industries Ltd (RIL) accounts for about 7.79% of the fund's total assets, followed by Infosys Ltd and Housing Development Finance Co (HDFC).
EPI's top 10 holdings account for about 35.59% of its total assets under management.
Performance and Risk
The ETF has lost about -9.50% so far this year and is up roughly 6.57% in the last one year (as of 03/09/2022). In the past 52-week period, it has traded between $29.64 and $39.26.
EPI has a beta of 0.79 and standard deviation of 27.05% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 473 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree India Earnings ETF is a reasonable option for investors seeking to outperform the Asia-Pacific (Emerging) ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares India 50 ETF (INDY - Free Report) tracks Nifty 50 Index and the iShares MSCI India ETF (INDA - Free Report) tracks MSCI India Total Return Index. IShares India 50 ETF has $603.89 million in assets, iShares MSCI India ETF has $5.21 billion. INDY has an expense ratio of 0.90% and INDA charges 0.65%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Asia-Pacific (Emerging) 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.