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Is WisdomTree Europe Hedged Equity ETF (HEDJ) a Strong ETF Right Now?
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A smart beta exchange traded fund, the WisdomTree Europe Hedged Equity ETF (HEDJ - Free Report) debuted on 01/04/2010, and offers broad exposure to the European Equity 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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
HEDJ is managed by Wisdomtree, and this fund has amassed over $1.62 billion, which makes it one of the larger ETFs in the European Equity ETFs. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree Europe Hedged Equity Index.
The WisdomTree Europe Hedged Equity Index is designed to provide exposure to European equities while at the same time neutralizing exposure to fluctuations between the Euro and the U.S. dollar.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.58% for this ETF, which makes it on par with most peer products in the space.
HEDJ's 12-month trailing dividend yield is 2.94%.
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, Banco Bilbao Vizcaya Argentaria Sa (BBVA - Free Report) accounts for about 7.26% of total assets, followed by Stellantis Nv (STLAM) and Asml Holding Nv (ASML - Free Report) .
HEDJ's top 10 holdings account for about 40.99% of its total assets under management.
Performance and Risk
The ETF has added roughly 6.57% so far this year and it's up approximately 17.17% in the last one year (as of 10/10/2024). In the past 52-week period, it has traded between $37.48 and $48.49.
The ETF has a beta of 0.89 and standard deviation of 16.60% for the trailing three-year period, making it a medium risk choice in the space. With about 164 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Europe Hedged Equity ETF is a reasonable option for investors seeking to outperform the European Equity ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares MSCI Eurozone ETF (EZU - Free Report) tracks MSCI EMU Index and the Vanguard FTSE Europe ETF (VGK - Free Report) tracks FTSE Developed Europe All Cap Index. IShares MSCI Eurozone ETF has $7.76 billion in assets, Vanguard FTSE Europe ETF has $19.45 billion. EZU has an expense ratio of 0.51% and VGK charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the European Equity 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 Europe Hedged Equity ETF (HEDJ) a Strong ETF Right Now?
A smart beta exchange traded fund, the WisdomTree Europe Hedged Equity ETF (HEDJ - Free Report) debuted on 01/04/2010, and offers broad exposure to the European Equity 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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
HEDJ is managed by Wisdomtree, and this fund has amassed over $1.62 billion, which makes it one of the larger ETFs in the European Equity ETFs. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree Europe Hedged Equity Index.
The WisdomTree Europe Hedged Equity Index is designed to provide exposure to European equities while at the same time neutralizing exposure to fluctuations between the Euro and the U.S. dollar.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.58% for this ETF, which makes it on par with most peer products in the space.
HEDJ's 12-month trailing dividend yield is 2.94%.
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, Banco Bilbao Vizcaya Argentaria Sa (BBVA - Free Report) accounts for about 7.26% of total assets, followed by Stellantis Nv (STLAM) and Asml Holding Nv (ASML - Free Report) .
HEDJ's top 10 holdings account for about 40.99% of its total assets under management.
Performance and Risk
The ETF has added roughly 6.57% so far this year and it's up approximately 17.17% in the last one year (as of 10/10/2024). In the past 52-week period, it has traded between $37.48 and $48.49.
The ETF has a beta of 0.89 and standard deviation of 16.60% for the trailing three-year period, making it a medium risk choice in the space. With about 164 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Europe Hedged Equity ETF is a reasonable option for investors seeking to outperform the European Equity ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares MSCI Eurozone ETF (EZU - Free Report) tracks MSCI EMU Index and the Vanguard FTSE Europe ETF (VGK - Free Report) tracks FTSE Developed Europe All Cap Index. IShares MSCI Eurozone ETF has $7.76 billion in assets, Vanguard FTSE Europe ETF has $19.45 billion. EZU has an expense ratio of 0.51% and VGK charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the European Equity 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.