Should WisdomTree U.S. High Dividend ETF (DHS) Be on Your Investing Radar?

Designed to provide broad exposure to the Large Cap Value segment of the US equity market, the WisdomTree U.S. High Dividend ETF (DHS) is a passively managed exchange traded fund launched on June 16, 2006.

The fund is sponsored by Wisdomtree. It has amassed assets over $1.60 billion, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.

Why Large Cap Value

Companies that find themselves in the large cap category typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.

While value stocks have lower than average price-to-earnings and price-to-book ratios, they also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.

Costs

Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.

Annual operating expenses for this ETF are 0.38%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 3.24%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Financials sector -- about 22.8% of the portfolio. Healthcare and Consumer Staples round out the top three.

Looking at individual holdings, Abbvie Inc (ABBV) accounts for about 4.74% of total assets, followed by Merck & Co Inc/nj (MRK) and Exxonmobil Holdings Corp (XOM).

The top 10 holdings account for about 33.01% of total assets under management.

Performance and Risk

DHS seeks to match the performance of the WisdomTree U.S. High Dividend Index before fees and expenses. The WisdomTree U.S. High Dividend Index is a fundamentally weighted index that measures the performance of companies with high dividend yields selected from the WisdomTree Dividend Index.

The ETF has added about 18.13% so far this year and is up about 20.17% in the last one year (as of 09/01/2026). In the past 52-week period, it has traded between $97.62 and $119.83.

The ETF has a beta of 0.59 and standard deviation of 12.41% for the trailing three-year period, making it a medium risk choice in the space. With about 322 holdings, it effectively diversifies company-specific risk.

Alternatives

WisdomTree U.S. High Dividend ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, DHS is a reasonable option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.

The Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Morningstar Value ETF (VTV) track a similar index. While Schwab U.S. Dividend Equity ETF has $112.02 billion in assets, Vanguard Morningstar Value ETF has $192.16 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.03%.

Bottom-Line

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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This article originally published on Zacks Investment Research (zacks.com).

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