WisdomTree U.S. SmallCap ETF (EES): A Smart Choice for Small Cap Value Investors
The WisdomTree U.S. SmallCap ETF (EES) debuted on February 23, 2007, offering broad exposure to the Small Cap Value category of the market. This smart beta ETF is managed by Wisdomtree and tracks the performance of the WisdomTree U.S. SmallCap Earnings Index, which measures the performance of earnings-generating companies within the small-capitalization segment of the U.S. Stock Market.
Smart beta ETFs are a popular alternative to traditional market cap weighted indexes, which have been the dominant strategy in the ETF industry. These non-cap weighted indexes are based on certain fundamental characteristics or a combination of such, and are designed to provide better risk-return performance than traditional indexes. The WisdomTree U.S. SmallCap ETF has an annual operating expense of 0.38% and a 12-month trailing dividend yield of 1.47%.
The ETF has a heavy allocation in the Financials sector, accounting for about 27.90% of the portfolio, with Industrials and Consumer Discretionary rounding out the top three sectors. Looking at individual holdings, Brighthouse Financial Inc (BHF) accounts for about 1.02% of total assets, followed by Valaris Ltd (G9460G101) and Bgc Group Inc-A (BGC). The top 10 holdings account for about 6.48% of total assets under management.
In terms of performance, the ETF has lost about -6.70% so far this year and was up about 9.63% in the last one year (as of June 17, 2025). It has a beta of 1.09 and a standard deviation of 22.16% for the trailing three-year period, making it a medium risk choice in the space. With about 911 holdings, it effectively diversifies company-specific risk.
Investors looking for alternatives to the WisdomTree U.S. SmallCap ETF can consider other ETFs in the space such as the IShares Russell 2000 Value ETF (IWN) and the Vanguard Small-Cap Value ETF (VBR). IWN has an expense ratio of 0.24% and VBR charges 0.07%. Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Small Cap Value segment of the market.
In conclusion, the WisdomTree U.S. SmallCap ETF is an excellent option for investors seeking to outperform the Small Cap Value segment of the market. While it carries some risk, its diversified holdings and low operating expenses make it a compelling choice for those looking to invest in this space.
