Designed to provide broad exposure to the Style Box - Small Cap Value category of the market, the WisdomTree U.S. SmallCap ETF (EES) is a smart beta exchange traded fund launched on 02/23/2007.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
EES is managed by Wisdomtree, and this fund has amassed over $721.09 million, which makes it one of the average sized ETFs in the Style Box - Small Cap Value. EES seeks to match the performance of the WisdomTree U.S. SmallCap Earnings Index before fees and expenses.
The WisdomTree U.S. SmallCap Index is a fundamentally weighted index that measures the performance of earnings-generating companies within the small-capitalization segment of the U.S. Stock Market.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.38% for EES, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.13%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
For EES, it has heaviest allocation in the Financials sector --about 25.1% of the portfolio --while Industrials and Information Technology round out the top three.
When you look at individual holdings, Venture Global Inc-cl A (VG) accounts for about 1.5% of the fund's total assets, followed by Organon & Co (OGN) and Matson Inc (MATX).
EES's top 10 holdings account for about 7.82% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree U.S. SmallCap ETF has added about 20.82% so far, and it's up approximately 23.22% over the last 12 months (as of 09/07/2026). EES has traded between $52.68 $69.88 in this past 52-week period.
EES has a beta of 1.01 and standard deviation of 20.11% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 875 holdings, it effectively diversifies company-specific risk .
Alternatives
WisdomTree U.S. SmallCap ETF is an excellent option for investors seeking to outperform the Style Box - Small Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
iShares Russell 2000 Value ETF (IWN) tracks Russell 2000 Value Index and the Vanguard Morningstar Small-Cap Value ETF (VBR) tracks CRSP U.S. Small Cap Value Index. iShares Russell 2000 Value ETF has $14.58 billion in assets, Vanguard Morningstar Small-Cap Value ETF has $37.54 billion. IWN has an expense ratio of 0.24% and VBR changes 0.05%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Small Cap Value
Bottom Line
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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WisdomTree U.S. SmallCap ETF (EES): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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