Is WisdomTree U.S. MidCap ETF (EZM) a Strong ETF Right Now?

Making its debut on 02/23/2007, smart beta exchange traded fund WisdomTree U.S. MidCap ETF (EZM) provides investors broad exposure to the Style Box - Mid Cap Value category of the market.

What Are Smart Beta ETFs?

Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.

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.

These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.

The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.

Fund Sponsor & Index

The fund is sponsored by Wisdomtree. It has amassed assets over $831.3 million, making it one of the average sized ETFs in the Style Box - Mid Cap Value. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree U.S. MidCap Earnings Index.

The WisdomTree U.S. MidCap Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the mid-capitalization segment of the U.S. Stock Market.

Cost & Other Expenses

Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.

Operating expenses on an annual basis are 0.38% for this ETF, which makes it on par with most peer products in the space.

EZM's 12-month trailing dividend yield is 1.29%.

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, Us Dollar accounts for about 52.46% of total assets, followed by Dreyfus Trsy Oblig Cash Mgmt Cl Ins and Roivant Sciences Ltd (ROIV).

EZM's top 10 holdings account for about 107.52% of its total assets under management.

Performance and Risk

The ETF has added about 10.47% so far this year and was up about 10.28% in the last one year (as of 12/23/2025). In the past 52-week period, it has traded between $51.81 and $68.84

EZM has a beta of 1.06 and standard deviation of 19.33% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 541 holdings, it effectively diversifies company-specific risk .

Alternatives

WisdomTree U.S. MidCap ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.

iShares Russell Mid-Cap Value ETF (IWS) tracks Russell MidCap Value Index and the Vanguard Mid-Cap Value ETF (VOE) tracks CRSP U.S. Mid Cap Value Index. iShares Russell Mid-Cap Value ETF has $14.49 billion in assets, Vanguard Mid-Cap Value ETF has $19.87 billion. IWS has an expense ratio of 0.23% and VOE changes 0.07%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Mid Cap Value

Bottom Line

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This article originally published on Zacks Investment Research (zacks.com).

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