Register
RE-EVALUATING TODAY’S ROTATION TO VALUE
Our Value Proposition for the 2020s

Why Value Strategies Now?

While growth had been outperforming since before the global financial crisis, the dominant multi-year run appears to have ended. Consider the Russell 3000 Growth and Value Indexes' price-to-earnings (P/E) ratios. Even after this year’s value comeback, its P/E discount to growth remains near multi-year extremes. Fueled by soaring inflation and concern about Fed monetary tightening, value appears positioned to outperform as investors focus on fundamentals.

P/E Ratios of U.S. Value vs. Growth

Sources: WisdomTree, FactSet, as of 2/28/22

WisdomTree Value Investing Family

With rates rising, Fed policy tightening and inflation at levels not seen since the 1970s, it’s critical to be hypervigilant about valuations. Investors can seek attractively valued companies with a key additional attribute: the ability to withstand prolonged inflation. To help investors diversify their value allocation and potentially capitalize on today’s environment, WisdomTree offers value products with an appealing focus on dividends.

WisdomTree Dividend-Weighted Value ETFs

We believe our original idea—weighting by dividends—is particularly relevant now as investors engage with the stock market in a time of heightened volatility. Our “aha” moment happened in the early 2000s, when we observed a nascent ETF industry that focused on building market cap-weighted funds that gave zero credence to valuations.

 

Learn more about the origin of dividend weighting in this recent webinar

Our research showed that giving stocks weights according to their cash dividends could be accretive to performance. In 2006, we launched our first family of dividend-weighted ETFs, including our flagship value Fund, WisdomTree U.S. LargeCap Dividend Fund (DLN). Now, as the post-COVID-19 world embraces value investing, we believe dividend weighting gives investors an edge relative to traditional market cap-weighted ETFs.

Another concept that we think could be beneficial for this type of market is a combination of dividends and buybacks. The WisdomTree U.S. Value Fund (WTV) provides exposures to companies that screen highly on that metric, and it does so at a competitive expense ratio.
Similar to our dividend-weighting concepts, we also have Funds that weight by earnings. If a company’s earnings become a greater proportion of the total earnings of all companies, it will receive a greater weight in the basket. The result is a value-oriented core Fund in large, mid- and small caps.

WisdomTree AI Enhanced Value Family

The WisdomTree U.S. AI Enhanced Value Fund (AIVL) and WisdomTree International AI Enhanced Value Fund (AIVI) bring an added layer of intelligence to value investing by blending human and artificial intelligence. Leveraging Voya’s Equity Machine Intelligence [EMI] proprietary model, they incorporate human/machine interaction at five critical stages, so investors can avoid narrow style biases, capture value exposure across equities and access uncorrelated return streams to help capitalize on long- and short-term opportunities.

Commentaries from Our Thought Leaders

Forgotten Mid- and Small-Cap Dividends
by Matt Wagner, CFA
There are a number of approaches to isolating value stocks. Matt Wagner explains why investors should start considering mid- and small-cap dividend approaches when seeking value. 
Read the blog post
The New Rates Regime Is a Value Regime
by Jeff Weniger, CFA
We have heard a thousand times that a stock is worth the present value of its future cash flows. Jeff Weniger explains the importance of this concept and why now—more than ever—investors should be focusing on value stocks. 
Read the blog post
The Stock Market Threw Its Interest Rate Rules of Thumb out the Window
by Jeff Weniger, CFA
The stock market's old rule of thumb on the relationship between interest rates and growth vs. value has changed. Jeff Weniger discusses how inflation rules the roost. 
Read the blog post
    For more daily insights from our thought leaders, visit our blog.
    Additional Offering for Financial Professionals
    lock
    Financial Professional Access Only
     Strategic Core Equity
    Our Strategic Model Portfolios are traditional equity, fixed income, and multi-asset models built to address long-term client investment objectives. Ranging from conservative to aggressive, these portfolios capture our long-term asset allocation philosophy, while allowing for periodic dynamic tilts as market conditions change. These portfolios seek to offer the potential for competitive risk-adjusted performance versus appropriate passive benchmarks without the higher costs associated with traditional active management.
    lock
    Financial Professional Access Only
     Siegel-WisdomTree Model Portfolios
    WisdomTree collaborates with thought leaders and third-party asset managers to offer co-branded model portfolios that leverage our combined intellectual capital. We also partner with advisors to offer custom model offerings designed to meet firm-specific objectives or distinct investment mandates. Collaborating with advisors to build highly customized model portfolios is a core value proposition of the WisdomTree Model Portfolio Investment Committee.