WisdomTree has launched a European UCITS exchange-traded fund platform with the listing of four ETFs on the London Stock Exchange (LSE), providing exposure to large and small-cap US and European equities.
WisdomTree’s four new ETFs are:
WisdomTree Europe Equity Income UCITS ETF (EEI)
WisdomTree Europe SmallCap Dividend UCITS ETF (DFE)
WisdomTree US Equity Income UCITS ETF (DHS)
WisdomTree US SmallCap Dividend UCITS ETF (DESE)
The establishment of WisdomTree’s European business marks a number of firsts for the European ETF industry. WisdomTree becomes Europe’s first ETF provider focussed on dividend-weighted ETFs and Europe’s first issuer of dividend-weighted small-cap ETFs.
WisdomTree’s UCITS ETFs started trading on the London Stock Exchange on 24 October and will initially be traded in GBP, EUR and USD. The ETFs are Irish-domiciled and physically replicated, with the underlying shares being held with State Street, a global leading custodian and administrator. KCG Europe will act as market maker for the products.
The four funds track proprietary WisdomTree indices, most of which have been live since 2006. The indices are designed to be an alternative to market capitalisation-weighted indices, which weight stocks on price alone.
WisdomTree pioneered indices weighted by the Dividend Stream – defined as the sum total of regular dividends paid in a particular index. Historically, dividends have provided a majority of the stock market’s real return over time and unlike other factors, dividends are an objective measure which are not affected by accounting treatments. Dividends are a major factor in determining stock price and a useful measure in determining company profitability and value, rather than stock price alone. In today’s low-yield world, a dividend-weighted ETF may increase the portfolio’s trailing 12-month dividend yield and provide extra income. Each ETF seeks to distribute dividends on a quarterly basis.