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Is WisdomTree U.S. High Dividend ETF (DHS) a Strong ETF Right Now?
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A smart beta exchange traded fund, the WisdomTree U.S. High Dividend ETF (DHS - Free Report) debuted on 06/16/2006, and offers 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.
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.
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.
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
Because the fund has amassed over $1.17 billion, this makes it one of the average sized ETFs in the Style Box - Large Cap Value. DHS is managed by Wisdomtree. Before fees and expenses, DHS seeks to match the performance of the WisdomTree U.S. High Dividend Index.
The WisdomTree U.S. High Dividend Index is a fundamentally weighted index that measures the performance of companies with high dividend yields selected from the WisdomTree Dividend Index.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.38%, making it on par with most peer products in the space.
DHS's 12-month trailing dividend yield is 3.62%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
DHS's heaviest allocation is in the Financials sector, which is about 25.20% of the portfolio. Its Energy and Utilities round out the top three.
Looking at individual holdings, Exxon Mobil Corp (XOM - Free Report) accounts for about 6.65% of total assets, followed by Abbvie Inc (ABBV - Free Report) and International Business Machines Corp (IBM - Free Report) .
DHS's top 10 holdings account for about 38.86% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree U.S. High Dividend ETF has gained about 18.95% so far, and it's up approximately 28.02% over the last 12 months (as of 10/15/2024). DHS has traded between $73.70 and $95.33 in this past 52-week period.
The ETF has a beta of 0.79 and standard deviation of 14.68% for the trailing three-year period, making it a medium risk choice in the space. With about 376 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. High Dividend 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 $61.12 billion in assets, Vanguard Value ETF has $130.61 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. High Dividend ETF (DHS) a Strong ETF Right Now?
A smart beta exchange traded fund, the WisdomTree U.S. High Dividend ETF (DHS - Free Report) debuted on 06/16/2006, and offers 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.
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.
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.
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
Because the fund has amassed over $1.17 billion, this makes it one of the average sized ETFs in the Style Box - Large Cap Value. DHS is managed by Wisdomtree. Before fees and expenses, DHS seeks to match the performance of the WisdomTree U.S. High Dividend Index.
The WisdomTree U.S. High Dividend Index is a fundamentally weighted index that measures the performance of companies with high dividend yields selected from the WisdomTree Dividend Index.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.38%, making it on par with most peer products in the space.
DHS's 12-month trailing dividend yield is 3.62%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
DHS's heaviest allocation is in the Financials sector, which is about 25.20% of the portfolio. Its Energy and Utilities round out the top three.
Looking at individual holdings, Exxon Mobil Corp (XOM - Free Report) accounts for about 6.65% of total assets, followed by Abbvie Inc (ABBV - Free Report) and International Business Machines Corp (IBM - Free Report) .
DHS's top 10 holdings account for about 38.86% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree U.S. High Dividend ETF has gained about 18.95% so far, and it's up approximately 28.02% over the last 12 months (as of 10/15/2024). DHS has traded between $73.70 and $95.33 in this past 52-week period.
The ETF has a beta of 0.79 and standard deviation of 14.68% for the trailing three-year period, making it a medium risk choice in the space. With about 376 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. High Dividend 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 $61.12 billion in assets, Vanguard Value ETF has $130.61 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.