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Is WisdomTree International High Dividend Fund (DTH) a Strong ETF Right Now?

Sweta Killa

The WisdomTree International High Dividend Fund (DTH) made its debut on 06/16/2006, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed World ETFs category of the market.

What Are Smart Beta ETFs?

The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.

Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.

There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.

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.

While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.

Fund Sponsor & Index

Managed by Wisdomtree, DTH has amassed assets over $248.15 M, making it one of the average sized ETFs in the Broad Developed World ETFs. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree International High Dividend Index.

The WisdomTree International High Dividend Index is a fundamentally weighted Index that measures the performance of companies with high dividend yields selected from the WisdomTree International Equity 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 0.58%, making it one of the more expensive products in the space.

DTH's 12-month trailing dividend yield is 4.63%.

Sector Exposure and Top Holdings

ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

Looking at individual holdings, Nestle Sa (NESN) accounts for about 2.82% of total assets, followed by China Mobile Ltd and Novartis Ag (NOVN).

DTH's top 10 holdings account for about 21.46% of its total assets under management.

Performance and Risk

Year-to-date, the WisdomTree International High Dividend Fund has added roughly 7.84% so far, and is down about -6.77% over the last 12 months (as of 05/16/2019). DTH has traded between $36.10 and $44.62 in this past 52-week period.

The ETF has a beta of 0.79 and standard deviation of 13.53% for the trailing three-year period, making it a medium risk choice in the space. With about 468 holdings, it effectively diversifies company-specific risk.

Alternatives

WisdomTree International High Dividend Fund is not a suitable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.

IShares MSCI EAFE ETF (EFA) tracks MSCI EAFE Index and the iShares Core MSCI EAFE ETF (IEFA) tracks MSCI EAFE Investable Market Index. IShares MSCI EAFE ETF has $61.53 B in assets, iShares Core MSCI EAFE ETF has $62.83 B. EFA has an expense ratio of 0.31% and IEFA charges 0.08%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed World 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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WisdomTree International High Dividend Fund (DTH): ETF Research Reports
 
iShares MSCI EAFE ETF (EFA): ETF Research Reports
 
Novan Inc. (NOVN) : Free Stock Analysis Report
 
iShares Core MSCI EAFE ETF (IEFA): ETF Research Reports
 
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