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Is WisdomTree International Equity ETF (DWM) a Strong ETF Right Now?
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Launched on 06/16/2006, the WisdomTree International Equity ETF (DWM - Free Report) is a smart beta exchange traded fund offering broad exposure to the Broad Developed World ETFs 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.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other 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
Because the fund has amassed over $576.68 million, this makes it one of the average sized ETFs in the Broad Developed World ETFs. DWM is managed by Wisdomtree. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree International Equity Index.
The WisdomTree International Equity Index is a fundamentally weighted Index that measures the performance of dividend-paying companies in the industrialized world, excluding Canada and the United States.
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.
Annual operating expenses for this ETF are 0.48%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 4.22%.
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.
Looking at individual holdings, Bhp Group Ltd (BHP - Free Report) accounts for about 3.47% of total assets, followed by Novartis Ag and Shell Plc-New (SHEL - Free Report) .
Its top 10 holdings account for approximately 16.84% of DWM's total assets under management.
Performance and Risk
Year-to-date, the WisdomTree International Equity ETF has lost about -1.50% so far, and is up roughly 13.86% over the last 12 months (as of 01/04/2024). DWM has traded between $46.50 and $52.58 in this past 52-week period.
DWM has a beta of 0.82 and standard deviation of 15.43% for the trailing three-year period, which makes the fund a low risk choice in the space. With about 1029 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree International Equity ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares MSCI EAFE ETF (EFA - Free Report) tracks MSCI EAFE Index and the iShares Core MSCI EAFE ETF (IEFA - Free Report) tracks MSCI EAFE Investable Market Index. IShares MSCI EAFE ETF has $50.27 billion in assets, iShares Core MSCI EAFE ETF has $104.76 billion. EFA has an expense ratio of 0.33% and IEFA 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 Broad Developed World 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 International Equity ETF (DWM) a Strong ETF Right Now?
Launched on 06/16/2006, the WisdomTree International Equity ETF (DWM - Free Report) is a smart beta exchange traded fund offering broad exposure to the Broad Developed World ETFs 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.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other 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
Because the fund has amassed over $576.68 million, this makes it one of the average sized ETFs in the Broad Developed World ETFs. DWM is managed by Wisdomtree. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree International Equity Index.
The WisdomTree International Equity Index is a fundamentally weighted Index that measures the performance of dividend-paying companies in the industrialized world, excluding Canada and the United States.
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.
Annual operating expenses for this ETF are 0.48%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 4.22%.
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.
Looking at individual holdings, Bhp Group Ltd (BHP - Free Report) accounts for about 3.47% of total assets, followed by Novartis Ag and Shell Plc-New (SHEL - Free Report) .
Its top 10 holdings account for approximately 16.84% of DWM's total assets under management.
Performance and Risk
Year-to-date, the WisdomTree International Equity ETF has lost about -1.50% so far, and is up roughly 13.86% over the last 12 months (as of 01/04/2024). DWM has traded between $46.50 and $52.58 in this past 52-week period.
DWM has a beta of 0.82 and standard deviation of 15.43% for the trailing three-year period, which makes the fund a low risk choice in the space. With about 1029 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree International Equity ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares MSCI EAFE ETF (EFA - Free Report) tracks MSCI EAFE Index and the iShares Core MSCI EAFE ETF (IEFA - Free Report) tracks MSCI EAFE Investable Market Index. IShares MSCI EAFE ETF has $50.27 billion in assets, iShares Core MSCI EAFE ETF has $104.76 billion. EFA has an expense ratio of 0.33% and IEFA 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 Broad Developed World 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.