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WisdomTree (NASDAQ: WETF ) has been proactive in launching products lately. The issuer has come up with new ETFs in every month of the ongoing quarter. Recently, the issuer rolled out two hedged ETFs, one in the international dividend arena and the other in the international small-cap space. In any case, WisdomTree is almost at the helm of currency-hedged ETF investing style. And this strategy would be extremely meaningful this year as the Fed looks to hike key rates sometime this year and most developed nations (even some emerging markets) are following easy money policy to boost their economies. As a result, the greenback is gaining strength against a basket of global currencies. Below we highlight the key characteristics and the future prospects of the two ETFs: WisdomTree Global ex-U.S. Hedged Dividend ETF (NYSEARCA: DXUS ) in Focus This fund looks to track the performance of the dividend-paying stocks of the developed and emerging markets outside of the U.S. The fund is exposed to about 38 countries among which Japan (19.10%) and the U.K. (15.64%) hold the top two spots. Financials (25.14%) and Consumer Discretionary (11.07%) are top two sectors of the fund. The product is free of concentration risk as no stock accounts for more than 1.92% of the fund. The wave of easy money polices across the globe, be it Europe or Asia, have brightened the appeal for dividend investing lately. Though the Fed is preparing for policy normalization this year, the modest U.S. growth momentum indicates a slower rate hike trajectory in the future. All these market forces should keep bond yields at check globally. As a result, investors looking for steady current income might shift their focus to high dividend stocks. Competition: The global dividend investing space is teeming with ETFs. Products like the PowerShares International Dividend Achievers Portfolio ETF (NYSEARCA: PID ) , the SPDR S&P International Dividend ETF (NYSEARCA: DWX ) and the First Trust Dow Jones Global Select Dividend Index ETF (NYSEARCA: FGD ) have already accumulated considerable investor wealth and could pose as threats to this tenderfoot dividend ETF. However, given the backing from currency-hedging technique, DXUS should be able to wait out the competition easily. WisdomTree International Hedged SmallCap Dividend ETF (NYSEARCA: HDLS ) in Focus The fund looks to give exposure of the small-capitalization slice of the dividend-paying segment of the world outside the U.S. and Canada. The fund is heavy on Japan (29.72%) followed by the U.K. (16.84%) and Australia (15.18%). As far as sector breakdown is concerned, Industrials and Consumer Discretionary top the list with over 20% exposure each. The next two positions are occupied by Financials (17.10%) and IT (10.82%). Individual holding wise, China Power International Deve (1.10%), Shenzhen Investment Ltd (0.72%) and IOOF Holdings Ltd (0.61%) are the top three holdings. This ensures very low company-specific concentration risk. The fund charges 58 bps in fees. Investors should note that small caps are seen as the true gauge of domestic economy. In a growing economy, these pint-sized securities perform better than large-cap stocks as the former generates most of their revenues from the domestic market. These are less ruffled by global economic concerns. Notably, a flurry of easy money in most of the developed world will lead to stepped-up economic activities, and rise in business and consumer confidence. This would in turn benefit the small-cap companies. Competition: The global small-cap ETF space is not yet chockablock. Only a handful of products such as the iShares Enhanced International Small-Cap ETF (NYSEARCA: IEIS ) , the Schwab Fundamental International Small Cap Company Index (NYSEARCA: FNDC ) , the SPDR S&P International Small Cap ETF (NYSEARCA: GWX ) and the Schwab International Small-Cap Equity ETF (NYSEARCA: SCHC ) might give tough competition to the newbie. However, the currency-hedged approach of HDLS gives it an edge over its peers. Originally posted on Zacks.com Scalper1 News
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