InvestmentsOct 23 2015

WisdomTree ETF

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WisdomTree ETF

WisdomTree has launched an Emerging Asia Equity Income ETF that measures the performance of emerging Asian securities.

The ETF comprises a fundamentally weighted index and includes dividend-paying companies from emerging Asian economies.

These economies include China, Indonesia, Korea, Malaysia, Philippines, Taiwan and Thailand and are ranked by dividend yield.

The index requires securities to meet minimum market capitalisation and liquidity requirements, to have paid dividends over the prior annual cycle and be listed on a stock exchange in one of the emerging Asian countries that the index includes.

The fund has a 3 per cent charge for both entry and exit. These charges are maximum figures paid by an investor dealing directly with the fund. In some cases, an investor might pay less.

An ongoing charge for the fund is 0.54 per cent.

An Ireland-domiciled fund, it invests heavily in financials with close to 37.2 per cent invested in the sector, followed by telecommunication services (14.9 per cent) and energy (12.2 per cent).

The Chart shows the fund’s exposure to various sectors.

The index is categorised under the higher-risk, higher-reward category and is not considered appropriate for short-term investors.

www.wisdomtree.eu

Emerging markets have once again come under scrutiny after the US Federal Reserve decided to delay its rate hike, pointing to global uncertainties.

Investors are concerned about the slowdown in the Chinese economy. The WisdomTree index for emerging Asian equities is unique in the sense that it gives broad exposure to dividend-paying emerging Asian equities. The index tracks a non-market capitalisation weighted index that provides investors with the advantage of diversifying their assets and risk.

Fund managers warn of greater risk in emerging markets as compared with developed markets. For example, the fund has its highest exposure in China with close to 38.5 per cent invested in the country. With the recent volatility in China, the investment may be at risk.