ABOUT WISDOMTREE IN EUROPE
We specialise in sponsoring and issuing Exchange Traded Products (ETPs) which include the WisdomTree UCITS Exchange Traded Funds (ETF) and Boost ETP ranges. In 2006, we listed our first ETFs and so many of our index strategies benefit from a live track record of over 10 years. Headquartered in New York, WisdomTree Investments, Inc. (‘WisdomTree’) has offices in London, Tokyo and Toronto.
At WisdomTree, we deploy smart ways to bring value to the investor by offering flexibility when it comes to investing to meet the many different trading objectives our clients have. Although most of our ETF index strategies in Europe are based on proprietary strategic beta structures, as a firm, we also provide specific market access strategies when we’re able to enhance existing approaches.
WisdomTree UCITS ETFs
Our UCITS smart beta ETFs focus on Dividend Growth, Equity Income, Small Cap, Currency Hedged and Enhanced Broad Commodities indices. Our products are listed on Borsa Italiana, Deutsche Börse, London Stock Exchange, and SIX Swiss Exchange. In order to provide investors choice, we have accumulating and distributing share classes for our flagship funds.
Boost ETPsIn Europe investors can trade using Boost, a range of fully collateralised ETNs and exchange traded commodities (ETCs) which are available in unleveraged as well as 2x to 5x short and leverage formats. Boost was the first European platform to offer 3x leveraged and inverse ETPs. Through these award-winning Boost products, investors can access a broad range of Equities, Commodities, Fixed Income, Alternatives and Currency strategies.
Stock prices can—and do—deviate from their underlying value for many reasons. WisdomTree believes fundamentals like dividends offer more objective measures of a company’s health, value and profitability than stock price alone.
The majority of ETFs are market cap-weighted—meaning they give more weight to companies selling at higher prices than those offering stronger fundamentals. WisdomTree’s dividend-weighted methodology is designed to magnify the effect dividends have on risk and return characteristics.
Dividends and dividend stocks have historically outpaced inflation*, and offer the potential for income, income growth and capital appreciation. In our opinion, dividends can provide many benefits—regardless of the market direction. And weighting by the Dividend Stream® can magnify the effect dividends have on performance.**
WisdomTree was the first investment manager to weight by the Dividend Stream. We do this to provide higher income and growth potential to investors. In the chart below, Professor Jeremy Siegel demonstrates the power of dividends by breaking the S&P 500 Index into dividend yield quintiles and tracking the growth of $1000 from 31 December 1957 to 31 December 2015. Not only did the stocks with the highest dividend yields more than triple the growth of the S&P over that time, they outperformed the stocks with the lowest dividend yields by nearly 600%.
Average Annual Total Returns, 1957-2016. Each stock in S&P 500 is ranked from highest to lowest by dividend yield on 31 December of every year and placed into "quintiles", baskets of stocks, with 100 stocks in each basket. The stocks in the quintiles are weighted by their market capitalisation. The dividend yield is defined as each stock's annual dividends per share divided by its stock price as of 31 December of that year.
*Professor Jeremy Siegel is a registered representative with Foreside Funds Service, LLC. Past performance is not indicative of future results.
Source: Kenneth French Data Library, with data as of 31/12/2015
You cannot invest directly in an index. Index performance does not represent actual fund or portfolio performance. A fund or portfolio may differ significantly from the securities included in the index. Index performance assumes reinvestment of dividends but does not reflect any management fees, transaction costs or other expenses that would be incurred by a portfolio or fund, or brokerage commissions on transactions in fund shares. Such fees, expenses and commissions could reduce returns. Past performance is not indicative of future results. Source: Siegel, Jeremy, Future for Investors (2005), with updates to 2012. Each stock in S&P 500 Index is ranked from highest to lowest by dividend yield on December 31st of every year and placed into "quintiles," baskets of 100 stocks in each basket. The stocks in the quintiles are weighted by their market capitalization. The dividend yield is defined as each stock's annual dividends per share divided by its stock price as of December 31st of that year. The S&P 500 Index is a capitalisation-weighted index of 500 stocks selected by the Standard & Poor's Index Committee designed to represent the performance of the leading industries in the United States economy.
*Source: WisdomTree US Bureau of Labour, the S&P 500 31/12/1957 - 31/12/2015
**Dividend Stream is defined as the sum of the cash dividends of all the constituents within the index, which constituent weights determined by each firm’s proportionate contribution to this aggregate number. Payment of dividends does not remove market risk and the potential for principal loss; a company may discontinue or reduce payment of dividends at any time.
In this hypothetical example, the dividend-weighted portfolio generates approximately 30% more dividend income and almost 1% of additional dividend yield than the market cap-weighted option. What's more—it did this using the same three stocks and the same initial investment.
1 Market capitalisation is calculated by multiplying a company's shares outstanding by the current market price of one share.