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HDLS Targets International Small Caps While Hedging Foreign Currency Exposure
DXUS Offers Access to Broad Global Dividend Payers While Hedging Foreign Currency Exposure
Expanding the WisdomTree Currency Hedged Equity Family
NEW YORK, June 4, 2015 (GLOBE NEWSWIRE) -- WisdomTree (Nasdaq:WETF), an exchange-traded product ("ETP") sponsor and asset manager, today announced the launch of the WisdomTree International Hedged SmallCap Dividend Fund (HDLS), and the WisdomTree Global ex-U.S. Hedged Dividend Fund (DXUS) on the NYSE Arca. HDLS seeks to provide exposure to the small-capitalization segment of the dividend-paying market in the developed world outside the U.S. and Canada, while neutralizing exposure to fluctuations of foreign currency relative to the U.S. dollar. DXUS seeks to provide exposure to the dividend-paying companies in the developed and emerging markets outside of the U.S. while neutralizing exposure to fluctuations of foreign currency movements relative to the U.S. dollar.
HDLS: Capturing International Small Cap Dividends
Approximately 50% of the world's investment opportunities are outside the U.S.1, and international small caps represent the potential for additional portfolio diversification. "For those thinking about small-cap equities, HDLS offers the same stock selection and rebalancing methodology of our Index that is tracked by the WisdomTree International SmallCap Dividend Fund (DLS) with a hedge that mitigates the currency risk inherent in international investing," said Jeremy Schwartz, WisdomTree Director of Research.
When DLS launched in 2006, its Index was the first to focus on international small caps. Now, HDLS tracks the first currency-hedged Index focused on international small caps. Currency-hedged strategies – like HDLS – provide the purest access to local equity returns as they are designed to neutralize the impact of currency from the equation.
Schwartz added, "Given the volatility reduction when currency risk is neutralized, currency-hedged strategies can serve as a strategic baseline exposure for international equities—and then the active decision would be to add in the currency risk if an investor has a positive view on it."
DXUS: Global Dividends Provide New Opportunities
For investors seeking income, international investments in dividend-paying companies offer a new horizon. As noted, approximately 50% of the world's investment opportunities are outside the U.S. and on average 96% of them pay dividends1. In addition to the developed world, the emerging markets represent a compelling source of dividend payers. However, unhedged international strategies take on the additional risk of currencies.
Schwartz said, "International dividend-paying equities can offer many advantages to investors from income and growth potential to downside protection, but currency is typically a source of added volatility. We believe that DXUS can provide investors with the opportunity to benefit from a broad array of international dividend payers while neutralizing currency risk."
WisdomTree: A Leading Innovator in Currency-Hedged ETFs
With the launch of HDLS and DXUS, WisdomTree now offers 16 currency-hedged ETFs. HDLS has an expense ratio of 0.58% and DXUS has a net expense ratio of 0.44%.
1 Based on the MSCI AC World Index, a broadly recognized global benchmark, as of 3/31/15, source Bloomberg.
The Funds HDLS and DXUS are new and have a limited operating history. Hedging can help returns when a foreign currency depreciates against the U.S. dollar, but can hurt when the foreign currency appreciates against the U.S. dollar.
Investors should carefully consider the investment objectives, risks, charges and expenses of the Fund before investing. To obtain a prospectus containing this and other important information, please call 866.909.WISE (9473), or visit wisdomtree.com to view or download a prospectus. Read the prospectus carefully before you invest.
There are risks associated with investing, including possible loss of principal. Foreign investing involves special risks, such as risk of loss from currency fluctuation or political or economic uncertainty. Investments in emerging markets are generally less liquid and less efficient than investments in developed markets and are subject to additional risks, such as risks of adverse governmental regulation and intervention or political developments. To the extent the Funds invests a significant portion of its assets in the securities of companies of a single country or region, it is likely to be impacted by the events or conditions affecting that country or region. Funds focusing their investments on certain sectors and/or smaller companies increase their vulnerability to any single economic or regulatory development. This may result in greater share price volatility. Dividends are not guaranteed and a company currently paying dividends may cease paying dividends at any time. The Funds use various strategies to attempt to minimize the impact of changes in foreign currency against the U.S. dollar, which may not be successful. Investments in derivative investments can be volatile, may be less liquid than securities and may be more sensitive to the effect of varied economic conditions. The Funds invests in the securities included in, or representative of, its Index regardless of their investment merit and the Funds do not attempt to outperform its Index or take defensive positions in declining markets. Due to the investment strategy of these Funds it may make higher capital gain distributions than other ETFs. Please read the Funds' prospectus for specific details regarding the Funds' risk profile.
Jeremy Schwartz is a registered representative of Foreside Fund Services, LLC.
WisdomTree Funds are distributed by Foreside Fund Services, LLC.
WisdomTree Investments, Inc., through its subsidiaries in the U.S. and Europe (collectively, "WisdomTree"), is an exchange-traded fund ("ETF") and exchange-traded product ("ETP") sponsor and asset manager headquartered in New York. WisdomTree offers products covering equities, fixed income, currencies, commodities and alternative strategies. WisdomTree currently has approximately $63.3 billion in assets under management globally. For more information, please visit www.wisdomtree.com or follow us on Twitter @WisdomTreeETFs.
WisdomTree® is the marketing name for WisdomTree Investments, Inc. and its subsidiaries worldwide.
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