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WisdomTree launches Emerging Markets Dividend Fund (DVEM) and International Quality Dividend Growth Fund (IQDG)


WisdomTree has launched the WisdomTree Emerging Markets Dividend Fund (DVEM), and the WisdomTree International Quality Dividend Growth Fund (IQDG) on the BATS Exchange. 

DVEM seeks to provide exposure to dividend-paying stocks in the emerging markets and has an expense ratio of 0.32 per cent. IQDG is designed to provide exposure to developed international dividend-paying stocks with growth characteristics and has an expense ratio of 0.38 per cent.

WisdomTree believes that dividends provide an objective measure of a company’s health and profitability – one that cannot be affected by accounting methods or government decisions. And while the emerging markets may not be the first place investors look when seeking income, we believe the region’s potential is significant. Over 93 per cent of traditional emerging market benchmarks are comprised of companies that paid at least one dividend over the prior 12 months.

“Dividends offer numerous benefits including the potential to enhance performance, increase portfolio income and help reduce downside risk,” said Jeremy Schwartz, WisdomTree Director of Research. “The power of weighting equity markets by the dividends companies pay rather than by their market value can be seen in the live performance track record of our existing WisdomTree Emerging Markets Dividend Index, relative to the broad market benchmark, the MSCI Emerging Markets Index.”

DVEM tracks a WisdomTree dividend-weighted index with nearly nine years of live performance data, broad exposure and a relative value rebalance. The cumulative outperformance and above benchmark dividend levels were achieved with less volatility and lower risk, whether evaluating standard deviation6 or beta relative to the broad market benchmark.

Dividend-paying equities have increasingly become an attractive option for investors looking to generate income and pursue higher total return potential. And within developed international equities, we believe there to be significant opportunity in seeking securities that exhibit the potential for dividend growth.

Schwartz says: “Rather than relying on historical records of dividend increases (as many existing indexes do), IQDG uses real-time growth and quality metrics focused on companies who have most potential to grow future dividends. This forward-looking process – utilized by our existing suite of quality dividend growth funds – is designed to capitalize on the faster dividend growth segment of the market.”  

IQDG’s existing currency hedged counterpart – The WisdomTree International Hedged Quality Dividend Growth Fund (IHDG) – was ranked as the single best performing fund in 2015 based on total return. The universe of 1547 funds consists of all international equity open-ended (OE) mutual funds and ETFs characterised by Morningstar as “Foreign Large Value, Foreign Large Blend or Foreign Large Growth.”

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