A Value-Oriented Mid-Cap ETF to Consider
Bronze-rated WisdomTree MidCap Earnings ETF's tilt toward cheaper stocks should give it an edge over the long run.
Adam McCullough: Bronze-rated WisdomTree MidCap Earnings is a passive mid-cap equity strategy that weights its holdings by fundamental metrics. This fund effectively diversifies risk and rebalances into stocks as they become cheaper relative to their earnings, which should give it an edge over the long run.
This fund offers a cost advantage compared to actively managed peers, but there are cheaper market-cap-weighted options available. It tracks the mid-cap portion of the WisdomTree Earnings Index, which weights its holdings by their cumulative earnings over the prior four quarters, relative to the aggregate earnings of the selection universe. WisdomTree measures earnings by S&P Core earnings instead of GAAP earnings, because they believe these more accurately represent a stock's operational earnings. S&P Core earnings remove gains or losses from noncore business activities such as hedging, asset sales, and litigation.
Adam McCullough does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.