“There are many higher-cost actively managed funds that tend to hug the benchmark with modest tilts toward active picks. In contrast, EMMF and DWMF are expected to have an active share greater than 80%, and we believe these differentials, combined with our multifactor model, create an opportunity to add value over time,” Schwartz added.
Developed and emerging market currencies exhibit different liquidity, risk and hedging costs. As a result, both EMMF and DWMF will also incorporate a dynamic currency overlay, building upon the dynamic currency hedging strategies WisdomTree ETFs already use, but with an active approach to evaluating and implementing currency hedge ratios.
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