We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is WisdomTree U.S. High Dividend ETF (DHS) a Strong ETF Right Now?
Read MoreHide Full Article
The WisdomTree U.S. High Dividend ETF (DHS - 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.
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.
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.
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
DHS is managed by Wisdomtree, and this fund has amassed over $1.12 billion, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. Before fees and expenses, DHS seeks to match the performance of the WisdomTree U.S. High Dividend Index.
The WisdomTree U.S. High Dividend Index is a fundamentally weighted index that measures the performance of companies with high dividend yields selected from the WisdomTree Dividend Index.
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 0.38% for DHS, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 3.36%.
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 DHS, it has heaviest allocation in the Healthcare sector --about 20.40% of the portfolio --while Energy and Consumer Staples round out the top three.
Taking into account individual holdings, Exxon Mobil Corp (XOM - Free Report) accounts for about 6.53% of the fund's total assets, followed by Chevron Corp (CVX - Free Report) and Philip Morris International Inc (PM - Free Report) .
DHS's top 10 holdings account for about 44.71% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree U.S. High Dividend ETF has added roughly 1.18% so far, and is up about 9.88% over the last 12 months (as of 06/30/2022). DHS has traded between $76.78 and $91.19 in this past 52-week period.
The ETF has a beta of 0.80 and standard deviation of 22.46% for the trailing three-year period, making it a medium risk choice in the space. With about 315 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. High 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 $51.20 billion in assets, Vanguard Value ETF has $93.87 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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is WisdomTree U.S. High Dividend ETF (DHS) a Strong ETF Right Now?
The WisdomTree U.S. High Dividend ETF (DHS - 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.
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.
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.
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
DHS is managed by Wisdomtree, and this fund has amassed over $1.12 billion, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. Before fees and expenses, DHS seeks to match the performance of the WisdomTree U.S. High Dividend Index.
The WisdomTree U.S. High Dividend Index is a fundamentally weighted index that measures the performance of companies with high dividend yields selected from the WisdomTree Dividend Index.
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 0.38% for DHS, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 3.36%.
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 DHS, it has heaviest allocation in the Healthcare sector --about 20.40% of the portfolio --while Energy and Consumer Staples round out the top three.
Taking into account individual holdings, Exxon Mobil Corp (XOM - Free Report) accounts for about 6.53% of the fund's total assets, followed by Chevron Corp (CVX - Free Report) and Philip Morris International Inc (PM - Free Report) .
DHS's top 10 holdings account for about 44.71% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree U.S. High Dividend ETF has added roughly 1.18% so far, and is up about 9.88% over the last 12 months (as of 06/30/2022). DHS has traded between $76.78 and $91.19 in this past 52-week period.
The ETF has a beta of 0.80 and standard deviation of 22.46% for the trailing three-year period, making it a medium risk choice in the space. With about 315 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. High 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 $51.20 billion in assets, Vanguard Value ETF has $93.87 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.