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Is WisdomTree U.S. LargeCap ETF (EPS) a Strong ETF Right Now?
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Launched on 02/23/2007, the WisdomTree U.S. LargeCap ETF (EPS - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
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.
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.
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
EPS is managed by Wisdomtree, and this fund has amassed over $695.49 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. EPS seeks to match the performance of the WisdomTree U.S. Earnings 500 Index before fees and expenses.
The WisdomTree U.S. LargeCap Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the large-capitalization segment of the U.S. Stock Market.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for EPS are 0.08%, which makes it one of the least expensive products in the space.
It's 12-month trailing dividend yield comes in at 1.59%.
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.
For EPS, it has heaviest allocation in the Information Technology sector --about 23.50% of the portfolio --while Healthcare and Financials round out the top three.
Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 5.91% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Alphabet Inc-Cl A (GOOGL - Free Report) .
EPS's top 10 holdings account for about 29.3% of its total assets under management.
Performance and Risk
So far this year, EPS has lost about -5.52%, and it's up approximately 7.67% in the last one year (as of 04/20/2022). During this past 52-week period, the fund has traded between $44.64 and $50.92.
EPS has a beta of 1.02 and standard deviation of 22.91% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 502 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. LargeCap ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Russell 1000 Value ETF (IWD - Free Report) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $57.95 billion in assets, Vanguard Value ETF has $103.87 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
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 - Large 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. LargeCap ETF (EPS) a Strong ETF Right Now?
Launched on 02/23/2007, the WisdomTree U.S. LargeCap ETF (EPS - Free Report) is a smart beta exchange traded fund offering broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
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.
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.
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
EPS is managed by Wisdomtree, and this fund has amassed over $695.49 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. EPS seeks to match the performance of the WisdomTree U.S. Earnings 500 Index before fees and expenses.
The WisdomTree U.S. LargeCap Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the large-capitalization segment of the U.S. Stock Market.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for EPS are 0.08%, which makes it one of the least expensive products in the space.
It's 12-month trailing dividend yield comes in at 1.59%.
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.
For EPS, it has heaviest allocation in the Information Technology sector --about 23.50% of the portfolio --while Healthcare and Financials round out the top three.
Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 5.91% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Alphabet Inc-Cl A (GOOGL - Free Report) .
EPS's top 10 holdings account for about 29.3% of its total assets under management.
Performance and Risk
So far this year, EPS has lost about -5.52%, and it's up approximately 7.67% in the last one year (as of 04/20/2022). During this past 52-week period, the fund has traded between $44.64 and $50.92.
EPS has a beta of 1.02 and standard deviation of 22.91% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 502 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. LargeCap ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Russell 1000 Value ETF (IWD - Free Report) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $57.95 billion in assets, Vanguard Value ETF has $103.87 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
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 - Large 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.