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Is WisdomTree U.S. MidCap ETF (EZM) a Strong ETF Right Now?
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The WisdomTree U.S. MidCap ETF (EZM - Free Report) was launched on 02/23/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Mid Cap Value 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.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
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.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is sponsored by Wisdomtree. It has amassed assets over $783.83 million, making it one of the average sized ETFs in the Style Box - Mid Cap Value. EZM seeks to match the performance of the WisdomTree U.S. MidCap Earnings Index before fees and expenses.
The WisdomTree U.S. MidCap Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the mid-capitalization segment of the U.S. Stock Market.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Operating expenses on an annual basis are 0.38% for this ETF, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.38%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
For EZM, it has heaviest allocation in the Financials sector --about 19.90% of the portfolio --while Consumer Discretionary and Industrials round out the top three.
Taking into account individual holdings, Cleveland-Cliffs Inc (CLF - Free Report) accounts for about 1.13% of the fund's total assets, followed by Organon & Co (OGN - Free Report) and Ovintiv Inc (OVV - Free Report) .
Its top 10 holdings account for approximately 7.95% of EZM's total assets under management.
Performance and Risk
The ETF has lost about -7.11% and was up about 1.81% so far this year and in the past one year (as of 04/25/2022), respectively. EZM has traded between $49.81 and $57.18 during this last 52-week period.
The fund has a beta of 1.25 and standard deviation of 29.79% for the trailing three-year period, which makes EZM a medium risk choice in this particular space. With about 580 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. MidCap ETF is an excellent option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell MidCap Value ETF (IWS - Free Report) tracks Russell MidCap Value Index and the Vanguard MidCap Value ETF (VOE - Free Report) tracks CRSP U.S. Mid Cap Value Index. IShares Russell MidCap Value ETF has $14.46 billion in assets, Vanguard MidCap Value ETF has $16.72 billion. IWS has an expense ratio of 0.23% and VOE charges 0.07%.
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 - Mid 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. MidCap ETF (EZM) a Strong ETF Right Now?
The WisdomTree U.S. MidCap ETF (EZM - Free Report) was launched on 02/23/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Mid Cap Value 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.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
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.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is sponsored by Wisdomtree. It has amassed assets over $783.83 million, making it one of the average sized ETFs in the Style Box - Mid Cap Value. EZM seeks to match the performance of the WisdomTree U.S. MidCap Earnings Index before fees and expenses.
The WisdomTree U.S. MidCap Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the mid-capitalization segment of the U.S. Stock Market.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Operating expenses on an annual basis are 0.38% for this ETF, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.38%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
For EZM, it has heaviest allocation in the Financials sector --about 19.90% of the portfolio --while Consumer Discretionary and Industrials round out the top three.
Taking into account individual holdings, Cleveland-Cliffs Inc (CLF - Free Report) accounts for about 1.13% of the fund's total assets, followed by Organon & Co (OGN - Free Report) and Ovintiv Inc (OVV - Free Report) .
Its top 10 holdings account for approximately 7.95% of EZM's total assets under management.
Performance and Risk
The ETF has lost about -7.11% and was up about 1.81% so far this year and in the past one year (as of 04/25/2022), respectively. EZM has traded between $49.81 and $57.18 during this last 52-week period.
The fund has a beta of 1.25 and standard deviation of 29.79% for the trailing three-year period, which makes EZM a medium risk choice in this particular space. With about 580 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. MidCap ETF is an excellent option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell MidCap Value ETF (IWS - Free Report) tracks Russell MidCap Value Index and the Vanguard MidCap Value ETF (VOE - Free Report) tracks CRSP U.S. Mid Cap Value Index. IShares Russell MidCap Value ETF has $14.46 billion in assets, Vanguard MidCap Value ETF has $16.72 billion. IWS has an expense ratio of 0.23% and VOE charges 0.07%.
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 - Mid 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.