PLAT Offers Access to Companies Generating Substantial Revenue from Platform Business Models
NEW YORK, May 22, 2019 (GLOBE NEWSWIRE) -- WisdomTree (WETF), an exchange-traded fund (“ETF”) and exchange-traded product (“ETP”) sponsor and asset manager, today announced the launch of the WisdomTree Modern Tech Platforms Fund (PLAT) on the NYSE Arca. PLAT seeks to track the price and yield performance, before fees and expenses, of the WisdomTree Modern Tech Platforms Index and has an expense ratio of 0.45%.
What is a “Modern Tech Platform”?
WisdomTree believes there is a compelling, long-term market opportunity created by the evolution of platform business models, or “modern technology platforms.” WisdomTree defines a modern technology platform as a company with a non-linear, multi-sided business model focused on creating value by facilitating interactions between two or more interdependent groups through technology. By doing so, platform businesses can benefit from:
- Scale advantages,
- Capital efficiency,
- Network effects, where the marginal cost of adding an additional user approaches zero as a platform grows, and
- Higher profitability margins.
“Platform-based businesses are gaining market share at the expense of traditional, linear businesses and doing so with much better scale economics and long-term profitability figures. Platform businesses are transforming value chains and we believe the breadth of opportunity expands far beyond great technology companies like Google, Amazon, Microsoft, and Apple,” said Jeremy Schwartz, WisdomTree EVP and Global Head of Research.
PLAT: What’s Under the Hood?
The WisdomTree Modern Tech Platforms Index seeks to provide access to mid- and large-cap companies listed on a U.S. or European stock exchange that are generating substantial revenue from a modern platform business with a market-cap minimum of $2 billion.
In order to be considered a platform business, the company must possess the following characteristics:
- Customer Relationship: The company has a direct relationship with a user group who consumes value.
- Producer Relationship: The company has a direct relationship with an external user group who supplies the value to be consumed by another user group.
- Platform Revenue: The company derives revenue from a platform business directly (as a percentage of the monetary value of each transaction it facilitates) or indirectly (by providing products or services related to the facilitation of value exchanges on the platform). Eligible platform types include services, product, payment, investment, social networking, gaming, communication, content and development.
- Platform Revenue Percentage: The company must meet a minimum revenue threshold from platform business units.
- Value Created by Producer: Value is supplied by a third-party and is not directly controlled by the company, and that supply does not sit on the company’s balance sheet.
- Network Ownership and Effect: The company owns the network by which the consumers and producers directly connect. The more consumers that use the platform, the more value each producer will get from the platform, and vice versa.
The Index is equally-weighted and rebalanced annually. Learn more about the WisdomTree Modern Tech Platforms Fund (PLAT) here.
This Fund is new and has limited operating history. Past performance is not indicative of future results.
There are risks associated with investing, including possible loss of principal. Foreign investing involves special risks, such as risk of loss from currency fluctuation or political or economic uncertainty; these risks may be enhanced in emerging, offshore or frontier markets. Technology platform companies have significant exposure to consumers and businesses and a failure to attract and retain a substantial number of such users to a company’s products, services, content or technology could adversely affect operating results. Technological changes could require substantial expenditures by a technology platform company to modify or adapt its products, services, content or infrastructure. Technology platform companies typically face intense competition and the development of new products is a complex and uncertain process. Concerns regarding a company’s products or services that may compromise the privacy of users, or other cybersecurity concerns, even if unfounded, could damage a company’s reputation and adversely affect operating results. Many technology platform companies currently operate under less regulatory scrutiny but there is significant risk that costs associated with regulatory oversight could increase in the future. The Fund invests in the securities included in, or representative of, its Index regardless of their investment merit and the Fund does not attempt to outperform its Index or take defensive positions in declining markets. The composition of the Index is heavily dependent on quantitative and qualitative information and data from one or more third parties and the Index may not perform as intended. Please read the Fund's prospectus for specific details regarding the Fund's risk profile.
Investors should carefully consider the investment objectives, risks, charges and expenses of the Funds before investing. To obtain a prospectus containing this and other important information, call 866.909.9473 or visit wisdomtree.com. Read the prospectus carefully before you invest.
WisdomTree Funds are distributed by Foreside Fund Services, LLC, in the U.S. only.
Jeremy Schwartz is a registered representative of Foreside Fund Services, LLC.
WisdomTree Investments, Inc., through its subsidiaries in the U.S., Europe and Canada (collectively, “WisdomTree”), is an exchange-traded fund (“ETF”) and exchange-traded product (“ETP”) sponsor and asset manager headquartered in New York. WisdomTree offers products covering equities, fixed income, currencies, commodities and alternative strategies. WisdomTree currently has approximately $57.1 billion in assets under management globally. For more information, please visit www.wisdomtree.com or follow us on Twitter @WisdomTreeETFs.
WisdomTree® is the marketing name for WisdomTree Investments, Inc. and its subsidiaries worldwide.