CLOSED 03/14/2019
WisdomTree begun trading the WisdomTree Global SmallCap Dividend Fund (BATS: GSD) on Thursday, November 12, 2015. Here is a synopsis of the new ETF:
FUND INFORMATION:
| Symbol: GSD | Exchange: BATS |
| Name: WisdomTree Global SmallCap Dividend Fund | Net Expense Ratio: 0.43% |
FUND OBJECTIVE:
The WisdomTree Global SmallCap Dividend Fund seeks to track the price and yield performance, before fees and expenses, of the WisdomTree Global SmallCap Dividend Index.
REFERENCE INDEX:
The WisdomTree Global SmallCap Dividend Index is a fundamentally weighted index that consists of small-capitalization companies selected from the WisdomTree Global Dividend Index (Parent Index), which defines the dividend-paying universe of companies in the United States, developed countries, and emerging markets throughout the world.
The starting universe of the Index consists of the bottom 5% of the total market capitalization of the Parent Index that have
(i) a market capitalization of at least $200 million as of the Index screening date; and
(ii) an average daily dollar trading volume of at least $100,000 for the 3 months preceding the Index screening date.
The Index then selects the largest 1,000 companies after the initial market cap and liquidity screens are applied. Securities are then weighted based on dividends paid. Companies that pay a greater total dollar amount of dividends are more heavily weighted.
As of October 27, 2015, the Index had a market capitalization range from $720 million to $2.96 billion, with an average market capitalization of $1.3 billion.
To derive a company’s initial Index weight,
(i) multiply the U.S. dollar value of the company’s annual gross dividend per share by the number of common shares outstanding for that company (Cash Dividend Factor);
(ii) calculate the Cash Dividend Factor for each company;
(iii) add together all of the companies’ Cash Dividend Factors; and
(iv) divide the company’s Cash Dividend Factor by the sum of all Cash Dividend Factors.
After a company’s initial weight is determined by cash dividends, the Index will apply a regional adjustment factor. This factor adjusts the weight allocated to each region (i.e., 3 regions – U.S., developed and emerging market countries) of the Index so the regional weights match those of the float-adjusted market cap weighted universe of dividend and non-dividend paying companies that meet the liquidity and market capitalization criteria for the Parent Index. “Float-adjusted” market cap means that the share amounts used in calculating the market cap reflect only shares available to investors. To the extent a region’s weight in the Index needs to be increased or decreased, the weight of each component security in that region will be increased or decreased, respectively, on apro rata basis. After the regional adjustment factor is applied, the Index will cap any one sector at 25%; however, sector weights may fluctuate above the specified cap in response to market conditions and/or the application of volume factor adjustments, as described below.
In addition, the Index methodology includes volume factor adjustments such that if a component security does not meet certain trading volume thresholds, the security will either be eliminated from inclusion in the Index or its weight in the Index will be reduced and reallocated pro rata among the other securities.
Top Holdings (11/11/15):
| Theravance Inc | 0.82% |
| Lexmark International Inc | 0.72% |
| DuPont Fabros Technology Inc | 0.67% |
| Select Income REIT | 0.66% |
| Pattern Energy Group Inc | 0.64% |
| Chambers Street Properties | 0.62% |
| Avon Products Inc | 0.62% |
| Cogent Communications Group In | 0.61% |
| SeaWorld Entertainment Inc | 0.59% |
| Capitol Federal Financial Inc | 0.59% |
Top Country Allocation (11/11/15):
| United States | 49.41% |
| Japan | 10.79% |
| United Kingdom | 5.84% |
| Canada | 5.36% |
| Australia | 3.97% |
| Taiwan | 2.89% |
| New Zealand | 2.12% |
| China | 1.92% |
| Norway | 1.69% |
| Germany | 1.58% |
Sector Weights (11/11/15):
| Financials | 26.52% |
| Industrials | 20.06% |
| Consumer Discretionary | 15.51% |
| Materials | 9.05% |
| Information Technology | 7.86% |
| Utilities | 6.38% |
| Consumer Staples | 5.17% |
| Energy | 4.33% |
| Health Care | 2.98% |
| Telecommunication Services | 2.04% |
Useful Links:
GSD Home Page
Category: Equities> Global> Global Dividends/Income
ETFtrack comment:
“Small-caps are a compelling asset class because they are typically the most sensitive to incremental changes in economic growth expectations-particularly in the region or country, in which they’re located. GSD offers investors the opportunity to access a broad cross-section of global small-cap, dividend-paying companies with the potential to capture a higher level of income,” said Jeremy Schwartz, WisdomTree Director of Research.
“When investors think of dividends, they tend to think of mature, large-cap companies, and as a result, they may wrongly overlook small-cap equities as a potential for income. However, many small-cap companies have proven business models with relatively stable earnings, and have the ability to pay out dividends to shareholders and grow them over time.”
WisdomTree was an early pioneer in international small-cap equities launching the first international small-cap ETF in 2006. In addition, WisdomTree was the first to launch Europe, Japan, and emerging markets small-cap ETFs.