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Is WisdomTree U.S. MidCap ETF (EZM) a Strong ETF Right Now?
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A smart beta exchange traded fund, the WisdomTree U.S. MidCap ETF (EZM - Free Report) debuted on 02/23/2007, and offers broad exposure to the Style Box - Mid Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by Wisdomtree, EZM has amassed assets over $808.01 million, making it one of the average sized ETFs in the Style Box - Mid Cap Value. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree U.S. MidCap Earnings Index.
The WisdomTree U.S. MidCap Earnings Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the mid-capitalization segment of the U.S. Stock Market.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for this ETF are 0.38%, making it on par with most peer products in the space.
EZM's 12-month trailing dividend yield is 1.41%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Financials sector - about 24.40% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Taking into account individual holdings, Diamondback Energy Inc (FANG - Free Report) accounts for about 0.97% of the fund's total assets, followed by Slm Corp (SLM - Free Report) and Dxc Technology Co (DXC - Free Report) .
The top 10 holdings account for about 7.94% of total assets under management.
Performance and Risk
So far this year, EZM has gained about 29.11%, and was up about 51.12% in the last one year (as of 10/21/2021). During this past 52-week period, the fund has traded between $34.99 and $54.78.
The ETF has a beta of 1.31 and standard deviation of 29.59% for the trailing three-year period, making it a medium risk choice in the space. With about 462 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. MidCap ETF is an excellent option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell MidCap Value ETF (IWS - Free Report) tracks Russell MidCap Value Index and the Vanguard MidCap Value ETF (VOE - Free Report) tracks CRSP U.S. Mid Cap Value Index. IShares Russell MidCap Value ETF has $14.76 billion in assets, Vanguard MidCap Value ETF has $15.26 billion. IWS has an expense ratio of 0.23% and VOE 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 Style Box - Mid 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.
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Is WisdomTree U.S. MidCap ETF (EZM) a Strong ETF Right Now?
A smart beta exchange traded fund, the WisdomTree U.S. MidCap ETF (EZM - Free Report) debuted on 02/23/2007, and offers broad exposure to the Style Box - Mid Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by Wisdomtree, EZM has amassed assets over $808.01 million, making it one of the average sized ETFs in the Style Box - Mid Cap Value. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree U.S. MidCap Earnings Index.
The WisdomTree U.S. MidCap Earnings Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the mid-capitalization segment of the U.S. Stock Market.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for this ETF are 0.38%, making it on par with most peer products in the space.
EZM's 12-month trailing dividend yield is 1.41%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Financials sector - about 24.40% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Taking into account individual holdings, Diamondback Energy Inc (FANG - Free Report) accounts for about 0.97% of the fund's total assets, followed by Slm Corp (SLM - Free Report) and Dxc Technology Co (DXC - Free Report) .
The top 10 holdings account for about 7.94% of total assets under management.
Performance and Risk
So far this year, EZM has gained about 29.11%, and was up about 51.12% in the last one year (as of 10/21/2021). During this past 52-week period, the fund has traded between $34.99 and $54.78.
The ETF has a beta of 1.31 and standard deviation of 29.59% for the trailing three-year period, making it a medium risk choice in the space. With about 462 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. MidCap ETF is an excellent option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell MidCap Value ETF (IWS - Free Report) tracks Russell MidCap Value Index and the Vanguard MidCap Value ETF (VOE - Free Report) tracks CRSP U.S. Mid Cap Value Index. IShares Russell MidCap Value ETF has $14.76 billion in assets, Vanguard MidCap Value ETF has $15.26 billion. IWS has an expense ratio of 0.23% and VOE 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 Style Box - Mid 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.