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Should WisdomTree U.S. SmallCap ETF (EES) Be on Your Investing Radar?
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The WisdomTree U.S. SmallCap ETF (EES - Free Report) was launched on 02/23/2007, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by Wisdomtree. It has amassed assets over $607.33 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. While value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.38%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.35%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 22.80% of the portfolio. Consumer Discretionary and Industrials round out the top three.
Looking at individual holdings, Mdc Holdings Inc accounts for about 0.92% of total assets, followed by Tri Pointe Group Inc (TPH - Free Report) and Genworth Financial Inc (GNW - Free Report) .
The top 10 holdings account for about 6.85% of total assets under management.
Performance and Risk
EES seeks to match the performance of the WisdomTree U.S. SmallCap Earnings Index before fees and expenses. The WisdomTree U.S. SmallCap Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the small-capitalization segment of the U.S. Stock Market.
The ETF return is roughly 11.18% so far this year and it's up approximately 9.21% in the last one year (as of 07/21/2023). In the past 52-week period, it has traded between $39.17 and $49.11.
The ETF has a beta of 1.26 and standard deviation of 23.11% for the trailing three-year period, making it a medium risk choice in the space. With about 912 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. SmallCap ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, EES is an excellent option for investors seeking exposure to the Style Box - Small Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 Value ETF (IWN - Free Report) and the Vanguard Small-Cap Value ETF (VBR - Free Report) track a similar index. While iShares Russell 2000 Value ETF has $11.86 billion in assets, Vanguard Small-Cap Value ETF has $25.86 billion. IWN has an expense ratio of 0.23% and VBR charges 0.07%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
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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Should WisdomTree U.S. SmallCap ETF (EES) Be on Your Investing Radar?
The WisdomTree U.S. SmallCap ETF (EES - Free Report) was launched on 02/23/2007, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by Wisdomtree. It has amassed assets over $607.33 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. While value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.38%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.35%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 22.80% of the portfolio. Consumer Discretionary and Industrials round out the top three.
Looking at individual holdings, Mdc Holdings Inc accounts for about 0.92% of total assets, followed by Tri Pointe Group Inc (TPH - Free Report) and Genworth Financial Inc (GNW - Free Report) .
The top 10 holdings account for about 6.85% of total assets under management.
Performance and Risk
EES seeks to match the performance of the WisdomTree U.S. SmallCap Earnings Index before fees and expenses. The WisdomTree U.S. SmallCap Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the small-capitalization segment of the U.S. Stock Market.
The ETF return is roughly 11.18% so far this year and it's up approximately 9.21% in the last one year (as of 07/21/2023). In the past 52-week period, it has traded between $39.17 and $49.11.
The ETF has a beta of 1.26 and standard deviation of 23.11% for the trailing three-year period, making it a medium risk choice in the space. With about 912 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. SmallCap ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, EES is an excellent option for investors seeking exposure to the Style Box - Small Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 Value ETF (IWN - Free Report) and the Vanguard Small-Cap Value ETF (VBR - Free Report) track a similar index. While iShares Russell 2000 Value ETF has $11.86 billion in assets, Vanguard Small-Cap Value ETF has $25.86 billion. IWN has an expense ratio of 0.23% and VBR charges 0.07%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
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.