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Is WisdomTree Cloud Computing ETF (WCLD) a Strong ETF Right Now?
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Launched on 09/06/2019, the WisdomTree Cloud Computing ETF (WCLD - Free Report) is a smart beta exchange traded fund offering broad exposure to the Technology ETFs 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.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
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.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
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
WCLD is managed by Wisdomtree, and this fund has amassed over $469.15 million, which makes it one of the average sized ETFs in the Technology ETFs. WCLD, before fees and expenses, seeks to match the performance of the BVP NASDAQ EMERGING CLOUD INDEX .
The BVP Nasdaq Emerging Cloud Index is an equally weighted Index, designed to measure the performance of emerging public companies focused on delivering cloud-based software to customers.
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 this ETF are 0.45%, making it on par with most peer products in the space.
WCLD's 12-month trailing dividend yield is 0%.
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.
WCLD's heaviest allocation is in the Information Technology sector, which is about 85.60% of the portfolio. Its Financials and Industrials round out the top three.
When you look at individual holdings, Squarespace Inc - Class A (SQSP - Free Report) accounts for about 2.48% of the fund's total assets, followed by Q2 Holdings Inc (QTWO - Free Report) and Wix.com Ltd (WIX - Free Report) .
WCLD's top 10 holdings account for about 20.89% of its total assets under management.
Performance and Risk
So far this year, WCLD has lost about -9.04%, and is down about -4.99% in the last one year (as of 07/30/2024). During this past 52-week period, the fund has traded between $26.89 and $37.05.
WCLD has a beta of 1.12 and standard deviation of 39.85% for the trailing three-year period. With about 68 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Cloud Computing ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Global X Cloud Computing ETF (CLOU - Free Report) tracks INDXX GLOBAL CLOUD COMPUTING INDEX and the First Trust Cloud Computing ETF (SKYY - Free Report) tracks ISE Cloud Computing Index. Global X Cloud Computing ETF has $401.99 million in assets, First Trust Cloud Computing ETF has $2.89 billion. CLOU has an expense ratio of 0.68% and SKYY charges 0.60%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology 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 Cloud Computing ETF (WCLD) a Strong ETF Right Now?
Launched on 09/06/2019, the WisdomTree Cloud Computing ETF (WCLD - Free Report) is a smart beta exchange traded fund offering broad exposure to the Technology ETFs 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.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
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.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
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
WCLD is managed by Wisdomtree, and this fund has amassed over $469.15 million, which makes it one of the average sized ETFs in the Technology ETFs. WCLD, before fees and expenses, seeks to match the performance of the BVP NASDAQ EMERGING CLOUD INDEX .
The BVP Nasdaq Emerging Cloud Index is an equally weighted Index, designed to measure the performance of emerging public companies focused on delivering cloud-based software to customers.
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 this ETF are 0.45%, making it on par with most peer products in the space.
WCLD's 12-month trailing dividend yield is 0%.
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.
WCLD's heaviest allocation is in the Information Technology sector, which is about 85.60% of the portfolio. Its Financials and Industrials round out the top three.
When you look at individual holdings, Squarespace Inc - Class A (SQSP - Free Report) accounts for about 2.48% of the fund's total assets, followed by Q2 Holdings Inc (QTWO - Free Report) and Wix.com Ltd (WIX - Free Report) .
WCLD's top 10 holdings account for about 20.89% of its total assets under management.
Performance and Risk
So far this year, WCLD has lost about -9.04%, and is down about -4.99% in the last one year (as of 07/30/2024). During this past 52-week period, the fund has traded between $26.89 and $37.05.
WCLD has a beta of 1.12 and standard deviation of 39.85% for the trailing three-year period. With about 68 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Cloud Computing ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Global X Cloud Computing ETF (CLOU - Free Report) tracks INDXX GLOBAL CLOUD COMPUTING INDEX and the First Trust Cloud Computing ETF (SKYY - Free Report) tracks ISE Cloud Computing Index. Global X Cloud Computing ETF has $401.99 million in assets, First Trust Cloud Computing ETF has $2.89 billion. CLOU has an expense ratio of 0.68% and SKYY charges 0.60%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology 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.