WisdomTree rolled out a family branch of exchange traded funds (ETFs) fundamentally weighted on the basis of trailing earnings. So the more a company earns, the more it’s weighted in the index.
Roger Nusbaum for TheStreet reports that these ETFs actually track closer to the makeup of a traditional cap-weighted index than WisdomTree’s dividend-weighted ETFs.
WisdomTree Low P/E Fund (EZY) weights stocks with the lowest price-to-earnings ratio most heavily. The ETFs within this family are great for a broad-based portfolio. Over time, sector makeup changes so watch closely. Right now, energy dominates the four funds, with 13%-21% making up the four large-cap funds, such as the Dividend 100 Fund (DTN).
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.