Is WisdomTree U.S. LargeCap ETF (EPS) a Strong ETF Right Now?

Core Insights - The article discusses the concept of smart beta ETFs, which aim to outperform traditional market cap weighted indexes through various stock selection strategies [1][11]. Group 1: Smart Beta ETFs Overview - Smart beta ETFs provide investors with alternatives to traditional market cap weighted funds, utilizing strategies such as equal-weighting and fundamental weighting [2][11]. - The WisdomTree U.S. LargeCap ETF (EPS) is highlighted as a smart beta ETF with over $948.76 million in assets, targeting the performance of the WisdomTree U.S. Earnings 500 Index [3][10]. Group 2: Cost and Performance - EPS has an annual operating expense ratio of 0.08%, making it one of the least expensive options in its category [4]. - The ETF has shown a performance increase of approximately 24.94% over the past year and 17.39% year-to-date as of July 18, 2024 [7]. Group 3: Sector Exposure and Holdings - EPS has a significant allocation of about 26.60% in the Information Technology sector, with Financials and Healthcare also being major sectors [5]. - The top 10 holdings of EPS account for approximately 35.33% of its total assets, with Microsoft Corp, Apple Inc, and Alphabet Inc-Cl A being the largest positions [6][17]. Group 4: Alternatives and Comparisons - Alternatives to EPS include the IShares Russell 1000 Value ETF (IWD) and the Vanguard Value ETF (VTV), which have significantly larger asset bases of $58.61 billion and $121.04 billion, respectively [8]. - IWD has an expense ratio of 0.19%, while VTV charges 0.04%, indicating a competitive landscape in terms of cost [8]. Group 5: Risk and Diversification - EPS has a beta of 0.99 and a standard deviation of 16.34% over the trailing three-year period, categorizing it as a medium-risk investment [18]. - The ETF holds approximately 501 stocks, providing effective diversification to mitigate company-specific risks [18].