WisdomTree is expanding its line of currency-hedged equity exchange traded funds to include an international dividend growth opportunity, helping investors diversify and protect against swings in the Forex market.
According to a SEC filing, the WisdomTree International Hedged Dividend Growth Fund will try to reflect the performance of the similarly named WisdomTree International Hedged Dividend Growth Index, which is comprised of dividend-paying stocks with growth characteristics of companies in the industrialized world, excluding Canada and the U.S.
The ETF will follow a type of fundamental or so-called smart-beta indexing methodology. Specifically, the underlying index tracks 300 stocks from the WisdomTree Dividend Index of Europe, Far East, Asia and Australia Index and ranks picks based on growth and quality factors, long-term earnings growth expectations, return on equity and return on assets.
Securities are then weighted based on dividends paid over the previous 12-month period – companies with a larger total dividend hold a heavier weighting in the index. However, securities are capped at a 5% weight, while sectors and countries are capped at 20%.
Country exposure will include Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, United Kingdom, Israel, Japan, Australia, New Zealand, Hong Kong or Singapore.