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Is WisdomTree U.S. SmallCap ETF (EES) a Strong ETF Right Now?
The WisdomTree U.S. SmallCap ETF (EES) was launched on 02/23/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Small Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, reflecting the market or a particular segment. These indexes offer low-cost, convenient, and transparent ways of replicating market returns, suitable for investors who subscribe to market efficiency.
For those believing in the potential to outperform the market through superior stock selection, non-cap weighted strategies known as smart beta are appealing. These strategies attempt to select stocks with better risk-return potential based on specific fundamental characteristics.
While the space provides a variety of options, from equal-weighting to more complex strategies like fundamental and volatility/momentum-based weighting, not all strategies have delivered stellar results.
Fund Sponsor & Index
The fund is sponsored by WisdomTree, amassing over $615.56 million in assets, placing it as an average-sized ETF in the Style Box - Small Cap Value. It seeks to match the performance of the WisdomTree U.S. SmallCap Earnings Index.
This index is a fundamentally weighted one, measuring the performance of earnings-generating companies within the small-capitalization segment of the U.S. stock market.
Cost & Other Expenses
Expense ratios significantly impact ETF returns over the long term. Cheaper funds tend to outperform more expensive ones, all else being equal. The annual operating expenses for EES are 0.38%, on par with most peer products.
EES's 12-month trailing dividend yield is 1.33%.
Sector Exposure and Top Holdings
While ETFs provide diversified exposure to minimize single stock risk, examining a fund's holdings before investing is crucial. ETFs usually disclose their holdings daily for transparency.
Us Dollar accounts for about 100% of total assets, followed by Valaris Ltd and Brighthouse Financial Inc. The top 10 holdings represent about 106.07% of total assets under management.
Performance and Risk
The ETF has gained about 0.87% and is up approximately 7.27% year-to-date (as of 08/20/2025). Over the past year, EES has traded between $42.54 and $58.78.
With a beta of 1.10 and a standard deviation of 22.13% for the trailing three-year period, the fund presents a medium risk level. Comprising about 903 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree U.S. SmallCap ETF is a viable option for investors aiming to outperform the Style Box - Small Cap Value segment. Alternatives include iShares Russell 2000 Value ETF tracking the Russell 2000 Value Index and Vanguard Small-Cap Value ETF tracking the CRSP U.S. Small Cap Value Index. iShares Russell 2000 Value ETF holds $11.31 billion in assets, while Vanguard Small-Cap Value ETF has $30.67 billion. Their respective expense ratios are 0.24% and 0.07%.
Investors seeking cost-effective and lower-risk options might consider traditional market cap weighted ETFs targeting the Style Box - Small Cap Value.
Bottom Line
To explore more about this product and other ETFs, one should screen for products aligning with investment goals and read articles on the latest developments in the ETF investing sphere by visiting Zacks ETF Center.
This article has been published in Zacks via Yahoo News.
