A smart beta exchange traded fund, the WisdomTree International High Dividend ETF (DTH) debuted on 06/16/2006, and offers broad exposure to the Broad Developed World ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
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.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by Wisdomtree, and has been able to amass over $384.04 million, which makes it one of the average sized ETFs in the Broad Developed World ETFs. This particular fund seeks to match the performance of the WisdomTree International High Dividend Index before fees and expenses.
The WisdomTree International High Dividend Index is a fundamentally weighted Index that measures the performance of companies with high dividend yields selected from the WisdomTree International Equity Index.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.58%.
It has a 12-month trailing dividend yield of 4.53%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
When you look at individual holdings, Hsbc Holdings Plc (HSBA) accounts for about 4.12% of the fund's total assets, followed by British American Tobacco Plc (BATS) and Allianz Se (ALV).
DTH's top 10 holdings account for about 20.81% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree International High Dividend ETF has added roughly 16.77% so far, and it's up approximately 17.92% over the last 12 months (as of 05/01/2025). DTH has traded between $37.33 and $43.99 in this past 52-week period.
The ETF has a beta of 0.63 and standard deviation of 16.22% for the trailing three-year period, making it a medium risk choice in the space. With about 605 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree International High Dividend ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares MSCI EAFE ETF (EFA) tracks MSCI EAFE Index and the iShares Core MSCI EAFE ETF (IEFA) tracks MSCI EAFE Investable Market Index. IShares MSCI EAFE ETF has $60.14 billion in assets, iShares Core MSCI EAFE ETF has $133.02 billion. EFA has an expense ratio of 0.32% and IEFA charges 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 Broad Developed World ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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WisdomTree International High Dividend ETF (DTH): ETF Research Reports Autoliv, Inc. (ALV): Free Stock Analysis Report iShares MSCI EAFE ETF (EFA): ETF Research Reports iShares Core MSCI EAFE ETF (IEFA): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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