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WisdomTree Emerging Markets High Dividend ETF: A Dividend Themed ETF To Capitalize On Record Low Valuations

Published Thu, 30 Apr 2020 20:48:12 -0400 on Seeking Alpha

I am bullish on DEM as EM valuations are at extremely compelling levels and I like DEM’s country exposure within the EM space.
Dividend themes will be rewarded in the current environment; you get a 6.34% dividend yield via DEM.
Over the years, on the monthly charts, DEM has respected the lower boundary of its wedge pattern and has now reached a point where historically it has staged a bounce.
Most people don’t need an emerging market fund, that doesn’t mean many don’t." - Bill Rocco
At the outset, let me acknowledge that, given heightened conditions of fear and uncertainty prevalent across the investing diaspora, emerging markets are probably not the current flavor of the season. That said, when I recently appeared on the Seeking Alpha podcast, I also mentioned that we are currently in an environment where it pays to be tactical in your investment endeavors, rather than follow traditional models of wealth generation. This WisdomTree Emerging Markets High Dividend ETF (DEM) is an ETF that has some interesting qualities that appeal to my tactical sensibilities. Before I proceed to justify my investment thesis, let me just briefly touch upon the profile of this ETF.
ETF Profile DEM looks to track the WisdomTree Emerging Markets High Dividend Index - a fundamentally weighted index that measures the performance of the top 30% dividend-yielding stocks in the Emerging Markets. Key selection criteria include, only considering those companies that have paid c.$5 million in annual cash dividends and a market capitalization of greater than $200 million. The ETF has a relatively long history of close to 13 years (inception date: - 13-July-2007).
EM valuations now at record lows, US valuations still above previous downturn low Given the general trepidation around, it’s easy to make a bear case for Emerging Markets (EMS) but what’s also worth considering is that despite being assigned a lower P/E multiple relative to the Developed markets (DM), returns for... Read more