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PRESS ROOM

WisdomTree Launches ETF Platform in Italy with Six UCITS Smart Beta ETFs on the Borsa Italiana

Monday 19th January '15

Hector McNeil, Co-CEO

WisdomTree Launches ETF Platform in Italy with Six UCITS Smart Beta ETFs on the Borsa Italiana
Leading Provider of Smart Beta ETFs Lists Six Dividend-Weighted Funds

  • WisdomTree Europe Equity Income UCITS ETF (EEI)
  • WisdomTree Europe SmallCap Dividend UCITS ETF (DFE)
  • WisdomTree US Equity Income UCITS ETF (DHS)
  • WisdomTree US SmallCap Dividend UCITS ETF (DESE)
  • WisdomTree Emerging Markets Equity Income UCITS ETF (DEM)
  • WisdomTree Emerging Markets SmallCap Dividend UCITS ETF (DGSE)


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 Italy, with all six funds listed on Borsa Italiana. Due to increasing global demand for ‘smart beta’ exposure, WisdomTree is proud to launch its six ETFs providing exposure to large and small-cap U.S., European, and emerging markets equities.

WisdomTree’s six new ETFs are:

 

Name of Fund Borsa Italiana Code  ISIN  TER (p.a.)  Index Dividend Yield(1) 
WisdomTree Europe Equity Income UCITS ETF  EEI  IE00BQZJBX31  0.29%  6.3%
WisdomTree Europe SmallCap Dividend UCITS ETF  DFE  IE00BQZJC527  0.38%  3.5%
WisdomTree US Equity Income UCITS ETF  DHS  IE00BQZJBQ63  0.29%  3.8%
WisdomTree US SmallCap Dividend UCITS ETF  DESE  IE00BQZJBT94  0.38%  3.2%
WisdomTree Emerging Markets Equity Income UCITS ETF  DEM  IE00BQQ3Q067  0.46%  6.6%
WisdomTree Emerging Markets SmallCap Dividend UCITS ETF  DGSE  IE00BQZJBM26  0.54%  4.5%

 

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, and will now start trading on Borsa Italiana from 20 January 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 market maker for the products.

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 (2) 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 and Deutsche Borse. Assets Under Management (AUM) are approximately $192. BOOST ETPs have enjoyed significant success with its short & leverage range on the Borsa Italiana and has captured over 30% of trading volumes on the ETF Plus ETC/ETN segment.

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. $39.2 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.

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 UCITS ETFs on Borsa Italiana. 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. Italian 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 ”

 

(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.