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PRESS ROOM

WisdomTree Launches ETF Platform in Germany with Six UCITS Smart Beta ETFs on the Deutsche Börse

Wednesday 25th February '15


Leading Provider of Smart Beta ETFs Lists Six Dividend-Weighted Funds
 
 

London, 26 February 2015: WisdomTree, an exchange-traded fund (“ETF”) and exchange-traded product (“ETP”) sponsor, and pioneer of dividend-weighted smart beta ETFs, today announced the launch of its European UCITS ETF platform in Germany, with all six funds listed on the Deutsche Börse Xetra platform. Due to increasing global demand for ‘smart beta’ exposure, WisdomTree is proud to launch its six ETFs providing exposure to large and small-cap European, U.S. and, Emerging Markets equities. 

WisdomTree’s six new ETFs are:

 
 
*Exposures within WisdomTree’s Equity Income Indices, regardless of region, tend to be predominantly large cap. Both the WT Europe Equity Income and WT U.S. Equity Income Indices had approximately 85% exposure to companies larger than $10 billion in market capitalization as of 31/12/2014. WisdomTree EM Equity Income Index has 58% in companies larger than $10 billion in market cap. However, the stock selection methodology can select large, mid and small cap stocks. 

** All 6 dividend yields quoted are the trailing 12m measure of dividend yields using the index level at 31/12/2014. 

The establishment of WisdomTree’s European business marks a number of firsts for the European ETF industry. WisdomTree is Europe’s first ETF provider focussed on dividend-weighted smart beta ETFs and Europe’s first issuer of dividend-weighted small-cap smart beta ETFs.

WisdomTree’s UCITS ETFs started trading on the London Stock Exchange in October 2014, Borsa Italiana in January 2015 and will now start trading on the Deutsche Börse Xetra platform from today, 26 February 2015. They will initially be traded in EUR. The ETFs are Irish-domiciled and physically replicated, with the underlying shares being held with State Street, a global leading custodian and administrator. One of the world’s leading ETF market makers, KCG Europe, will act as lead market maker for the products.

Jonathan Steinberg, CEO and President of WisdomTree Investments, Inc. said:

“WisdomTree is a proven ETF innovator and a passionate ETF industry advocate. We are excited to bring our unique ETF focus and experience to this important market, where we seek to offer differentiated investment solutions backed by a veteran management team.” 

Hector McNeil, Co-CEO of WisdomTree Europe commented: 

“We are extremely proud to be launching WisdomTree’s first Smart Beta UCITS ETFs on the Deutsche Börse. WisdomTree is founded on well-built indices, insightful research and a track record of innovation. In addition to BOOST ETPs, which provide investors with a unique product set to hedge portfolios or enhance returns, WisdomTree ETFs are unique, tracking broad indices with multi-year track records. German investors are leading the charge on the adoption of ETPs as the investment product of choice and we believe we will follow the success enjoyed by the BOOST range with the listing of these WisdomTree UCITS ETFs.”

WisdomTree ‘Smart Beta’ Dividend Indices

The six funds track proprietary WisdomTree indices with multi-year track records. The indices are designed to be an alternative to market capitalisation-weighted indices, which weight stocks on price alone. We believe the major flaw with market capitalisation weighted indices is that as stocks increase in price, their weight in the index increases and vice versa, as stocks decrease in price, their weight in the index decreases. As a result, an index whose weights are based on market capitalisation may overweight overvalued stocks and underweight undervalued stocks. 

WisdomTree pioneered indices weighted by the Dividend Stream® - defined as the sum total of regular dividends paid in a particular index. Historically, dividends have provided a majority of the stock market’s real return over time and unlike other factors, dividends are an objective measure which are not affected by accounting treatments. Dividends are a major factor in determining stock price and a useful measure in determining company profitability and value, rather than stock price alone. In today’s low-yield world, a dividend-weighted ETF may increase the portfolio’s trailing 12-month dividend yield and provide extra income. Each ETF seeks to distribute dividends on a quarterly basis.

Additionally, WisdomTree’s dividend indices offer a number of potential benefits: founded on experience and transparency, many of the indices have live track records since 2006 or 2007, broad exposure to companies in the index, and access to a different weighting methodology which brings potential diversification benefits to a portfolio when held alongside market cap-weighted assets, by potentially reducing risk, increasing returns, or both.

WisdomTree acquisition of BOOST ETP

WisdomTree Europe was established in April 2014 upon the acquisition of BOOST ETP. In addition to UCITS ETFs under the WisdomTree brand, WisdomTree Europe will continue to manage and grow the BOOST ETP line up of predominately 3x short and 3x leveraged fully collateralised ETPs under the BOOST ETP brand. BOOST ETPs were first launched on the London Stock Exchange in December 2012 and currently are listed on the LSE, Borsa Italiana, Deutsche Börse and Börse Stuttgart. 

Built on a Compelling Track-Record

A smart beta innovator, WisdomTree pioneered the concepts of fundamentally weighted ETFs and active ETFs and is currently an industry leader in both categories. WisdomTree launched its first funds in 2006 and is currently the fifth largest ETF provider in the US with approx. $48 billion in AUM. Globally, WisdomTree is currently the eighth largest ETP provider with strategies spanning a wide range of asset classes and countries around the world. WisdomTree is the only independent, publicly traded asset manager focused exclusively on the ETP market. WisdomTree is headquartered in New York and its common stock is listed on the Nasdaq Global Select Market (symbol: WETF). WisdomTree approaches Europe with the same core focus: bringing innovation and differentiated investment solutions to the ETF market. 

1 Source: WisdomTree, Bloomberg, as of 31 December 2014. Dividend yields are based on last 12 months for all six of the underlying indices.

2 Source: Professor Robert Shiller, with data as of 30/9/2014.

END
 
Notes to Editors

About WisdomTree Europe Ltd

WisdomTree Investments, Inc., through its subsidiaries in the U.S. and Europe, including WisdomTree Europe Ltd based in London, is an exchange-traded fund (“ETF”) and exchange-traded product (“ETP”) sponsor and asset manager. WisdomTree offers products covering equities, fixed income, currencies, commodities and alternative strategies. Through WisdomTree Europe Ltd, it sponsors WisdomTree UCITS ETFs and BOOST short and leverage ETPs. WisdomTree currently has approximately $48 billion in assets under management globally. For more information, please visit www.wisdomtree.com.

WisdomTree® is the marketing name for WisdomTree Investments, Inc. and its subsidiaries worldwide. 

Investment objective of WisdomTree’s six new ETFs:

The WisdomTree Europe Equity Income UCITS ETF tracks the WisdomTree Europe Equity Income Index. The index is a fundamentally weighted index that measures the performance of companies with high dividend yields selected from the WisdomTree DEFA Index. At the index measurement date, companies within the WisdomTree DEFA Index that are listed on one of the major stock exchanges in Europe with market capitalizations of at least $200 million and that meet additional liquidity requirements are ranked by dividend yield. Securities ranking in the highest 30% by dividend yield are selected for inclusion. Companies are weighted in the index based on annual cash dividends paid. 

The WisdomTree Europe SmallCap Dividend UCITS ETF tracks the WisdomTree Europe SmallCap Dividend Index. The index is a fundamentally weighted index that measures the performance of the small-capitalization segment of the European dividend-paying market. The index is comprised of the companies that compose the bottom 25% of the market capitalization of the WisdomTree Europe Dividend Index after the 300 largest companies have been removed. Companies are weighted in the index based on annual cash dividends paid. This index was established on 31 May, 2006. 

The WisdomTree US Equity Income UCITS ETF tracks the WisdomTree US Equity Income Index. The index is a fundamentally weighted index that measures the performance of companies with high dividend yields selected from the WisdomTree US Dividend Index. At the index measurement date, companies within the WisdomTree US Dividend Index with market capitalizations of at least $200 million and average daily trading volumes of at least $200,000 for the prior three months are ranked by dividend yield. Securities ranking in the highest 30% by dividend yield are selected for inclusion. The index is dividend weighted annually to reflect the proportionate share of the aggregate cash dividends each component company is projected to pay in the coming year, based on the most recently declared dividend per share. This index was established on 31 May, 2006. 

The WisdomTree US SmallCap Dividend UCITS ETF tracks the WisdomTree US SmallCap Dividend Index. The index is a fundamentally weighted index measuring the performance of the small-capitalization segment of the US dividend-paying market. The index is comprised of the companies that compose the bottom 25% of the market capitalization of the WisdomTree US Dividend Index after the 300 largest companies have been removed. The index is dividend weighted annually to reflect the proportionate share of the aggregate cash dividends each component company is projected to pay in the coming year, based on the most recently declared dividend per share. This index was established on 31 May, 2006. 

The WisdomTree Emerging Markets Equity Income UCITS ETF tracks the WisdomTree Emerging Markets Equity Income Index, a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index. At the index measurement date, companies within the WisdomTree Emerging Markets Dividend Index are ranked by dividend yield. Securities ranking in the highest 30% by dividend yield are selected for inclusion. Companies are weighted in the Index based on annual cash dividends paid. This index was established on 1 June, 2007.

The WisdomTree Emerging Markets SmallCap Dividend UCITS ETF tracks the WisdomTree Emerging Markets SmallCap Dividend Index, a fundamentally weighted index that measures the performance of primarily small cap stocks selected from the WisdomTree Emerging Markets Dividend Index. Companies included in the Index fall within the bottom 10% of total market capitalisation of the WisdomTree Emerging Markets Dividend Index as of the annual index measurement date. Companies are weighted in the Index based on annual cash dividends paid. This index was established on 1 August, 2007. 

Disclaimer 

WisdomTree Europe Ltd is an appointed representative of Mirabella Financial Services LLP which is authorised and regulated by the Financial Conduct Authority. 

The value of an investment in ETPs may go down as well as up and past performance is not a reliable indicator of future performance. An investment in ETPs is dependent on the performance of the underlying index, less costs, but it is not expected to match that performance precisely. ETPs involve numerous risks including among others, general market risks relating to the relevant underlying index, credit risks on the provider of index swaps utilised in the ETP, exchange rate risks, interest rate risks, inflationary risks, liquidity risks and legal and regulatory risks. 

ETPs offering daily leveraged or daily short exposures (“Leveraged ETPs”) are products which feature specific risks that prospective investors should understand before investing in them. Higher volatility of the underlying indices and holding periods longer than a day may have an adverse impact on the performance of Leveraged ETPs. As such, Leveraged ETPs are intended for financially sophisticated investors who wish to take a short term view on the underlying indices. As a consequence, WisdomTree Europe Ltd is not promoting or marketing BOOST ETPs to Retail Clients. Investors should refer to the section entitled "Risk Factors" and “Economic Overview of the ETP Securities” in the Prospectus for further details of these and other risks associated with an investment in Leveraged ETPs and consult their financial advisors as needed. Within the United Kingdom, this document is only made available to professional clients and eligible counterparties as defined by the FCA. Under no circumstances should this document be forwarded to anyone in the United Kingdom who is not a professional client or eligible counterparty as defined by the FCA.This marketing information is intended for professional clients & sophisticated investors (as defined in the glossary of the FCA Handbook) only.

This marketing information is derived from information generally available to the public from sources believed to be reliable although WisdomTree Europe Ltd does not warrant the accuracy or completeness of such information. All registered trademarks referred to herein have been licensed for use. None of the products discussed above are sponsored, endorsed, sold or promoted by any registered trademark owner and such owners make no representation or warranty regarding the advisability on dealing in any of the ETPs.