Dan Silagi

WisdomTree: Riding the ETF Wave

Comparing Janus to Wisdomtree is comparing apples to oranges. Janus has a market cap of $4 billion, 200 million shares outstanding, and about $160 billion under management. While they were very hot years ago, recently, their track record has been average -- in other words, they perform with the markets, not better. (Most mutual funds don't beat the market averages, and for that matter, neither do most hedge funds.)

The interesting thing about Janus is they only earned $100 million, or about 0.06% (0.0006) on each dollar invested. This, in spite of the fact that they charge 1% or so as a management fee. This is in part due to the legions of analysts and others they have working there.

Wisdomtree, and other ETF's, have computers do most of the work. Their overhead (and fees) will be much, much lower than Janus and its competitors. If Wisdomtree ever managed $160 billion in assets, you could be sure that they'll earn orders of magnitude more than $100 million.