WisdomTree Eurozone Quality Dividend Growth UCITS ETF

Issuer: WisdomTree

Asset Class: Equity

TER: 29bps

Trading Currency: GBX

Pays Income: False

Listing Date: 08 Nov 2016

Ticker: EGRP

ISIN: IE00BZ56SY76

This fund offers a strategic approach to investing in the Eurozone equity market by moving beyond traditional market-capitalisation-weighted methodologies. It aims to provide exposure to a basket of high-quality, dividend-paying companies that also exhibit strong growth characteristics. The core objective is to capture the performance of fundamentally sound businesses with the potential for sustainable, long-term capital appreciation. This strategy is designed for investors seeking a core European equity holding that intelligently screens for companies based on their operational efficiency and future earnings potential, rather than simply their size.

The investment process is rooted in a proprietary index methodology that begins with a broad universe of dividend-paying companies across the Eurozone. This universe is then systematically filtered using two primary factor screens. The 'quality' screen identifies companies with strong profitability metrics, such as high return on equity and return on assets. The 'growth' screen then assesses the long-term earnings growth expectations for these quality companies. The final portfolio is composed of the top-ranking securities that pass these rigorous checks. The constituents are then weighted based on the aggregate cash dividends they are projected to pay, which helps to instill a strong valuation discipline.

This quality and growth-focused approach can result in a portfolio with distinct characteristics compared to standard benchmarks. By emphasising financially healthy firms with positive outlooks, the strategy may offer a degree of resilience during periods of market stress. The focus on dividend growth, rather than just high current yield, is intended to create a compounding effect over time, making it suitable for long-term investors. The dividend-based weighting scheme also helps to avoid over-concentration in the largest mega-cap stocks, providing a more balanced exposure to the drivers of the European economy.