ETF Spotlight on WisdomTree International SmallCap Dividends (NYSEARCA:DLS), part of a recurring series.
Assets: $276 million
Top three holdings:
- Nexity, 0.8%
- Vector Limited, 0.7%
- Provident Financial, 0.7%
Top country weightings:
- United Kingdom, 42.2%
- Japan, 33.8%
- Asia ex-Japan, 23.2%
- Industrials, 23.6%
- Consumer Discretionary, 22.2%
- Financial, 15.4%
Objective: DLS is designed to track the performance of the WisdomTree International SmallCap Dividend Index, and attempts to invest all (or substantially all) of its assets in stocks that make up the index. The index measures the small-cap segment of the dividend-paying market in the industrialized world (minus the United States and Canada). The index is made up of the bottom 25% of the market cap of the WisdomTree DEFA Index.
What to note:
- DLS currently comes with a 6.4% yield and is diversified, with 721 components
- It’s up 5.3% year-to-date
- It comes with a 0.58% expense ratio
In the last three months, small-cap stocks have been surving on worries that the financial sector is still unstable. Small-caps carry a market cap anywhere from $300 million to $2 billion, and are among the more volatile investments. In the wake of the financial crisis, investors are diversifying themselves among small-caps instead of relying on the just one sector in that asset class.
History typically suggests that small-caps lead the gains in the inital movement of stocks at the beginning of nearly every economic recovery. But since little about this market has been “typical,” it’s best to wait for the trend lines to show themselves first.