WisdomTree To Create Nonfinancial Dividend ETFs
Source: http://www.indexuniverse.com/sections/newsinfocus/5462-wisdomtree-to-create-non-financial-dividend-etfs.html?Itemid=3&utm_source=straightstocks.com&utm_medium=sidebar&utm_campaign=rssPosted on Thursday, February 26th, 2009 | In Exchange Traded Funds
WisdomTree changing pair of dividend-focused ETFs to exclude Financial stocks.
WisdomTree Investments is changing the investment strategy of two of its dividend-focused exchange-traded funds so that they exclude exposure to the Financials sector.
Beginning in late April, the WisdomTree Dividend Top 100 (NYSE Arca: DTN) will be renamed the WisdomTree Dividend ex-Financials Fund; its international counterpart, the WisdomTree International Dividend Top 100 (NYSE Arca: DOO), will be renamed the WisdomTree International Dividend Ex-Financials Fund.
The funds will become the first dividend-focused ETFs to exclude Financials.
“There are quite a few dividend-focused ETFs on the market today, many of which have significant exposure to Financials,” said Luciano Siracusano, director of sales for WisdomTree. “We wanted to provide clients with a choice, to give them the option to get yield without getting exposure to Financials.”
The Financials sector tends to be one of the higher-yielding sectors in the market, and dividend-focused ETFs tend to be overweight Financials. The most popular dividend ETF, the iShares Dow Jones Select Dividend Fund (NYSE Arca: DVY), is currently 24.55% invested Financials; that compares to the S&P 500, which is currently just 9.98% exposed.
As of February 25, both DTN and DOO had large positions in the Financials too: 23.18% for DTN and 39.10% for DOO. The funds will trade out of those positions by late April, replacing them with other high-yielding stocks. WisdomTree says that there will be no tax consequences, which is not surprising given that most Financial stocks are trading at multiyear lows.
“We won’t know for sure until we calculate the new index, but my instinct is that the change will not have much of an impact on the yield of the fund,” said Siracusano. ”We have 34 dividend-weighted ETFs on the market. We thought we would take two of them—one domestic and one international—and give people the option to get exposure without the financials exposure.”
The filing announcing the move is available here.
– This report was submitted by IndexUniverse.com’s Matthew Hougan.
Last 5 posts by IndexUniverse Staff
- Will UNL Beat UNG? - November 19th, 2009
- A Real Hedge Fund ETF? - November 17th, 2009
- ProShares’ Positive Tax Surprise? - November 17th, 2009
- Better Than Cash? - November 17th, 2009
- Stoxx Indexes Bought; Company Valued At $900M - November 13th, 2009
Exchange Traded Funds, Financials Fund;, index universe, iShares Dow Jones Select Dividend Fund, Luciano Siracusano;, Matthew Hougan;, Sp 500, WisdomTree Dividend Top 100;, WisdomTree International Dividend Ex-Financials Fund;, WisdomTree International Dividend Top 100;, Wisdomtree Investments
 About IndexUniverse Staff (http://indexuniverse.com)
IndexUniverse encompasses the world of indexing and beyond. Our website and related subsites cover product and market developments related to index funds, exchange-traded funds (ETFs), index derivatives (futures / options / swaps), and the sophisticated investment strategies which use these financial tools. Our goal is to provide the industry's best news, columns, research, and features about the dynamic field of index-based investing and trading. Industry professionals, individual investors, business/finance students and academic researchers will find various features targeting their interests and needs. We also provide valuable tools and data to assess markets and investment products, and specialized discussion boards for our registered members to exchange cutting-edge ideas and market views. We aim to be educational, thought-provoking, and most importantly, rigorously independent in our perspective. The development of IndexUniverse was a global effort, originally led by Steven Schoenfeld and Jim Wiandt, supported by John Spence and a diverse team in the U.S., Europe and Latin America, and enhanced by editorial contributors from around the world. The site is now managed solely by Jim Wiandt and the global Index Publications LLC team. The site was originally started by Steven as a data and information complement to his book, Active Index Investing, published by Wiley Finance in July 2004. As he recognized the need and potential for such a resource, in August 2003, Steven partnered with Jim, who as editor of The Journal of Indexes similarly recognized the industry's need for timely, useful and independent information on products and markets. |
No recommendations, either expressed or implied, are being made to buy, sell, hold or short any of the mentioned stocks. No legal, tax or accounting advice is expressed or implied. Always contact your attorney, CPA, or tax advisor before acting on any legal or tax issues. StraightStocks.com is not responsible for the content, products, or services of any of the advertisers on this site. StraightStocks.com receives compensation from advertisers on this blog. Services and products referred to herein are trademarks, registered trademarks, servicemarks, and/or registered servicemarks of their respective trademark or servicemark owners.