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Europe Hedged Small-Cap Equity ETF (EUSC) Hits New 52-Week High

Zacks Equity Research

For investors looking for momentum, the WisdomTree Europe Hedged Small-Cap Equity ETF EUSC is probably on your radar now. The fund just hit a 52-week high. Shares of EUSC are up roughly 30.53% from their 52-week low price of $21.78/share.


But could more gains be ahead for this ETF? Let’s take a quick look at the fund and the near-term outlook to get a better idea on where it might be headed:


EUSC in Focus


EUSC focuses on providing exposure to Eurozone small-cap equities while hedging the currency impact. Industrials, Consumer Discretionary, and Financials are the top three sectors, with 23.70%, 17.76%, and 17.20% allocation, respectively (as on April 7, 2017). From a geographical perspective, it has around 21.8% exposure to Italy, 19.15% to France, and 18.40% to Germany. It charges 58 basis points in fees per year and has top holdings in UnipolSai SpA, Eutelsat Communications, and Hugo Boss AG with a meager 6.12% allocation to them (see all European Equity ETFs here).


Why the move?


Lately, the Euro region has been gaining a lot of traction. Better-than-expected economic results, a March Purchasing Managers Index of 56.7 and Economic Sentiment Indicator reaching 107.9 in the Euro area have boosted the confidence of investors. Further, a recent poll by Elabe on April 5, 2017 indicates that Le Pen is expected to lose majorly in the second run off in the French Presidential elections on May 7, 2017. Therefore, investors are confident and are looking at this region as a potential investment. Moreover, small cap companies are more domestically focused and provide a more refined exposure to the region (read: Join Eurozone Rally with These ETFs).


More Gains Ahead?


Currently, EUSC has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook. So it is hard to get a handle on its future returns one way or another. However, it has a weighted alpha of 23.9 and a low 14-day volatility of 7.21%.  So, there is definitely still some promise for those who want to ride this surging ETF a little further.


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WISDMTR-EUR HSC (EUSC): ETF Research Reports
 
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