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Making its debut on 06/16/2006, smart beta exchange traded fund WisdomTree International Equity ETF (DWM) provides investors broad exposure to the 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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
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.
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
DWM is managed by Wisdomtree, and this fund has amassed over $581.32 million, which makes it one of the larger ETFs in the World ETFs. This particular fund seeks to match the performance of the WisdomTree International Equity Index before fees and expenses.
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.
The fund has a 12-month trailing dividend yield of 4.36%.
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.
Taking into account individual holdings, Bhp Group Ltd (BHP) accounts for about 3.62% of the fund's total assets, followed by Novartis Ag (NOVN) and Nestle Sa (NESN).
Its top 10 holdings account for approximately 16.36% of DWM's total assets under management.