USSD, USWD: new USD Sensitivity Equity ETFs by WisdomTree

WisdomTree begun trading of 2 new smart beta ETFs, the WisdomTree Strong Dollar U.S. Equity Fund (NYSE Arca: USSD),  and the WisdomTree Weak Dollar U.S. Equity Fund (NYSE Arca: USWD) on Tuesday, July 21, 2015.

 

1.
FUND INFORMATION:

Symbol: USSD    Exchange: NYSE Arca
Name: WisdomTree Strong Dollar U.S. Equity Fund Net Expense Ratio: 0.33%

 

FUND OBJECTIVE:
The WisdomTree Strong Dollar U.S. Equity Fund seeks to track he price and yield performance, before fees and expenses, of the WisdomTree Strong Dollar U.S. Equity Index.

REFERENCE INDEX:
The WisdomTree Strong Dollar U.S. Equity Index onsists of equity securities of U.S. companies that derive more than 80% of their revenue from the United States. The Index is designed with a goal of minimizing exposure to U.S. companies with significant revenue from exports that are vulnerable to a strengthening U.S. dollar. A strengthening U.S. dollar causes the exports of U.S. companies to be more expensive in foreign markets, which may result in less foreign demand for such exports. Furthermore, when the U.S. dollar is strengthening, a U.S. company’s revenue and profits earned in foreign markets may depreciate when being converted back into U.S. dollars.
Companies in the Index are incorporated and listed in the United States. To be eligible for inclusion in the Index a company must meet the following criteria:
(i) market capitalization of at least $5 billion as of the Index screening date;
(ii) average daily dollar trading volume of at least $200,000 for the six months preceding the Index screening date; and
(iii) a calculated volume factor (the average daily dollar trading volume for the three months preceding the Index screening date divided by the preliminary weight of the security in the Index) greater than $200 million.

For these purposes, a company’s “preliminary weight” is determined by applying the weighting scheme described below to all of the companies eligible for inclusion in the Index before taking into account their calculated volume factors. The Index is a modified market capitalization weighted index designed to increase weight to companies that have the highest positive correlation in equity performance to a strong U.S. dollar. Each stock’s correlation with the U.S. dollar is measured and correlations can range from -1.0 to 1.0. Those stocks with the highest (or most positive) correlations to the U.S. dollar receive higher weights in the Index. The weight is composed of two factors: 25% is determined by the market capitalization of constituents and the other 75% is based on the rank of each stock’s correlation to the U.S. dollar as described above. The maximum weight of any one sector in the Index, at the time of the Index’s annual screening date, is capped at 25%, subject to the following volume factor adjustment. In response to market conditions and/or the volume factor adjustment discussed below, sector weight may fluctuate above the specified cap between annual Index screening dates. In the event that a company has a calculated volume factor that is less than $400 million as of the annual Index screening date, the company’s weight in the Index will be reduced. The company’s reduced weight is calculated by multiplying the company’s weight in the Index, based on the modified market capitalization weighting scheme, as adjusted by the sector cap, and determined on the annual Index screening date by the fraction of its current calculated volume factor divided by $400 million.

 

Top 10 Holdings :

Verizon Communications Inc 1.50%
AT&T Inc 1.43%
Comcast Corp 1.11%
Home Depot Inc 1.06%
Berkshire Hathaway Inc 1.01%
Wells Fargo & Co 0.99%
CVS Caremark Corp 0.91%
UnitedHealth Group Inc 0.90%
Altria Group Inc 0.89%
WEC Energy Group Inc 0.83%

 

Sector Allocation:

Financials  25.03%
Consumer Discretionary  20.11%
Utilities  14.31%
Industrials  10.63%
Health Care  10.52%
Consumer Staples  8.81%
Information Technology  5.25%
Telecommunication Services  5.03%

 

Useful Links:
USSD Home Page

 

 

2.
FUND INFORMATION:

Symbol: USWD Exchange: NYSE Arca
Name: WisdomTree Weak Dollar U.S. Equity Fund Net Expense Ratio: 0.33%

 

FUND OBJECTIVE:
The WisdomTree Weak Dollar U.S. Equity Fund seeks to track the price and yield performance, before fees and expenses, of the WisdomTree Weak Dollar U.S. Equity Index.

 

REFERENCE INDEX:
The WisdomTree Weak Dollar U.S. Equity Index onsists of equity securities of U.S. companies that derive less than 60% of their revenue from the United  States.
The Index is designed with a goal of maximizing exposure to U.S. companies with significant revenue from exports that may benefit from a weakening U.S. dollar. A weakening U.S. dollar causes the exports of U.S. companies to be less expensive in foreign markets and therefore may result in greater foreign demand for such exports. Furthermore, when the U.S. dollar is weakening, a U.S. company’s revenue and profits earned in foreign markets may appreciate when being converted back into U.S. dollars. Companies in the Index are incorporated and listed in the United States.  To be eligible for inclusion in the Index a company must meet the following criteria:
(i) market capitalization of at least $5 billion as of the Index screening date;
(ii) average daily dollar trading volume of at least $200,000 for the six months preceding the Index screening date; and
(iii) a calculated volume factor (the average daily dollar trading volume for the three months preceding the Index screening date divided by the preliminary weight of the security in the Index) greater than $200 million.

For these purposes, a company’s “preliminary weight” is determined by applying the weighting scheme described below to all of the companies eligible for inclusion in the Index before taking into account their calculated volume factors. The Index is a modified market capitalization weighted index designed to increase weight to companies that have the highest inverse correlation in equity performance to a strong U.S. dollar. Each stock’s correlation with the U.S. dollar is measured and correlations can range from -1.0 to 1.0. Those stocks with the lowest (or most negative) correlations to the U.S. dollar receive higher weights in the Index. The weight is composed of two factors: 25% is determined by the market capitalization of constituents and the other 75% is based on the rank of each stock’s correlation to the U.S. dollar as described above. The maximum weight of any one sector in the Index, at the time of the Index’s annual screening date, is capped at 25%, subject to the following volume factor adjustment. In response to market conditions and/or the volume factor adjustment discussed below, sector weight may fluctuate above the specified cap between annual Index screening dates. In the event that a company has a calculated volume factor that is less than $400 million as of the annual Index screening date, the company’s weight in the Index will be reduced. The company’s reduced weight is calculated by multiplying the company’s weight in the Index, based on the modified market capitalization weighting scheme, as adjusted by the sector cap, and determined on the annual Index screening date by the fraction of its current calculated volume factor divided by $400 million.

 

Top 10 Holdings:

Apple Inc 1.76%
General Electric Co 1.24%
Exxon Mobil Corp 1.18%
Johnson & Johnson 1.15%
Microsoft Corp 1.03%
Citigroup Inc 1.02%
Amazon.com Inc 0.99%
Pfizer Inc 0.96%
Celgene Corp 0.84%
Procter & Gamble Co/The 0.83%

 

Sector Allocation:

Information Technology 24.49%
Health Care 19.53%
Industrials 14.74%
Consumer Discretionary 12.27%
Materials 9.00%
Financials 7.58%
Consumer Staples 7.44%
Energy 4.74%

 

Useful Links:
USWD Home Page

 

 

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