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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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The WisdomTree Emerging Markets High Dividend ETF (DEM - Free Report) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs 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
The fund is managed by Wisdomtree. DEM has been able to amass assets over $2.44 billion, making it one of the larger ETFs in the Broad Developed Market ETFs. Before fees and expenses, this particular fund seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.63%, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 6.43%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Looking at individual holdings, Vale Sa (VALE3) accounts for about 4.99% of total assets, followed by Petroleo Brasileiro Sa (PETR3) and Mediatek Inc.
DEM's top 10 holdings account for about 28.36% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree Emerging Markets High Dividend ETF return is roughly 7.91% so far, and was up about 18.93% over the last 12 months (as of 10/26/2023). DEM has traded between $32.14 and $40.83 in this past 52-week period.
The ETF has a beta of 0.75 and standard deviation of 16.13% for the trailing three-year period, making it a medium risk choice in the space. With about 442 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is not a suitable option for investors seeking to outperform the Broad Developed Market ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares Core MSCI Emerging Markets ETF (IEMG - Free Report) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO - Free Report) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $66.75 billion in assets, Vanguard FTSE Emerging Markets ETF has $67.96 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed Market 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 Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
The WisdomTree Emerging Markets High Dividend ETF (DEM - Free Report) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs 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
The fund is managed by Wisdomtree. DEM has been able to amass assets over $2.44 billion, making it one of the larger ETFs in the Broad Developed Market ETFs. Before fees and expenses, this particular fund seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.63%, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 6.43%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Looking at individual holdings, Vale Sa (VALE3) accounts for about 4.99% of total assets, followed by Petroleo Brasileiro Sa (PETR3) and Mediatek Inc.
DEM's top 10 holdings account for about 28.36% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree Emerging Markets High Dividend ETF return is roughly 7.91% so far, and was up about 18.93% over the last 12 months (as of 10/26/2023). DEM has traded between $32.14 and $40.83 in this past 52-week period.
The ETF has a beta of 0.75 and standard deviation of 16.13% for the trailing three-year period, making it a medium risk choice in the space. With about 442 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is not a suitable option for investors seeking to outperform the Broad Developed Market ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares Core MSCI Emerging Markets ETF (IEMG - Free Report) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO - Free Report) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $66.75 billion in assets, Vanguard FTSE Emerging Markets ETF has $67.96 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed Market 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.