What Is the DGS ETF? Returns, Expense Ratio, Holdings, and Alternative ETFs Explained
A fundamentally weighted ETF that invests in emerging market dividend-growth stocks and small- and mid-cap companies. It targets both high dividend yields and the growth potential of smaller companies.
SubscribeWhat Is This ETF?
The fund tracks the WisdomTree Emerging Markets SmallCap Dividend Index. It builds its portfolio from carefully selected dividend-paying companies in the lower market-capitalization segment of emerging markets such as Taiwan, China, and South Korea.
It suits investors who want exposure to emerging market growth while also seeking a stable cash flow from dividends and the potential appreciation of undervalued small- and mid-cap stocks.
WisdomTree launched the ETF in 2007, and it is managed passively (index-tracking).
How Does It Invest?
| Item | Details |
|---|---|
| Tracking Index | WisdomTree Emerging Markets SmallCap Dividend Index |
| Management Style | Passive (dividend-weighted) |
| Rebalancing Frequency | Once a year |
| Dividend Frequency | Quarterly |
| Total Expense Ratio | 0.58% |
Weights are set in proportion to the cash dividends companies pay, not by market capitalization. This approach reduces the weight of stocks whose prices have risen excessively and helps uncover stocks with high dividend yields relative to their value.
- Fundamentally weighted strategy based on dividends
- Portfolio specialized in emerging market small- and mid-cap stocks
- Broad diversification across more than 1,000 holdings
Size and Costs
Assets under management (AUM) stand at $1.6B, and the total expense ratio is 0.58% per year.
Unlike typical emerging market index ETFs, which are heavily concentrated in large technology stocks, this fund is built mainly around small- and mid-cap companies closely tied to local economies, offering differentiated exposure.
Performance and Trends
1-Year Price Performance
Dividend & Yield
52-Week Price RangeThe fund has performed well when emerging market economies recover or commodity prices are stable. Because of the nature of small- and mid-cap stocks, it has at times shown relatively higher volatility in market conditions led by large caps.
Preferences for emerging market assets shift frequently with the global interest rate environment and the trend in the US Dollar Index, and steady inflows from investors searching for undervalued value stocks have been observed in the market.
Strengths and Weaknesses
The fund offers a high dividend yield and the growth potential of small- and mid-cap stocks at the same time, but investors should consider the volatility and currency risk typical of emerging markets.
💪 Key Strengths
⚠️ Points to Watch
Alternative ETFs and Related Products
DEM, shown in the table, focuses on high-dividend large-cap emerging market stocks, while DVYE and EDIV are similar products that concentrate on dividend yield. DFEM takes a broad factor-based approach, and FDEM uses a multifactor strategy. For exposure to the emerging market as a whole, EEM and VWO are the best-known choices, and for small- and mid-cap exposure focused on growth rather than dividends, FEMS and EWX are also worth considering.
Peer Comparison ETFs| Ticker | Name | Price | Change | AUM | Total Expense Ratio | Dividend Yield | 1Y |
|---|---|---|---|---|---|---|---|
 DFEM | Dimensional Emerging Markets Core Equity 2 ETF | $36.75 | +1.3% | $8.8B | 0.39% | 2.12% | +12.3% |
 DEM | WisdomTree Emerging Markets High Dividend Fund | $53.17 | +1.2% | $4.0B | 0.63% | 4.16% | +15.9% |
 EDIV | State Street SPDR S&P Emerging Markets Dividend ETF | $40.71 | +1.2% | $1.2B | 0.49% | 4.3% | +6.4% |
 DVYE | iShares Emerging Markets Dividend ETF | $33.02 | +1.7% | $1.1B | 0.50% | 5.28% | +8.4% |
 FDEM | Fidelity Emerging Markets Multifactor ETF | $33.80 | +0.7% | $494.5M | 0.25% | 3.45% | +10.6% |
Top Holdings| Ticker | Name | Weight | Price | Change | Market Cap | P/E | Dividend Yield |
|---|---|---|---|---|---|---|---|
 OMAB | Grupo Aeroportuario del Centro Norte SAB de C.V ADR | 0.02% | $108.39 | +2.5% | $4.6B | 16.8 | 5.16% |
 SBS | Companhia de Saneamento Basico do Estado de Sao Paulo ADR | 0.01% | $4.62 | +4.5% | $16.2B | 10.7 | 3.1% |
 BMRC | Bank of Marin Bancorp | 0.00% | $29.52 | +1.6% | $479.2M | - | 3.39% |
| BAC | Bank Of America Corp | 0.00% | $51.63 | +4.0% | $356.3B | 12.3 | 2.33% |
 DRD | DRDGold Ltd ADR | 0.00% | $24.40 | +8.2% | $2.1B | 8.4 | 3.57% |
 KNSA | Kiniksa Pharmaceuticals International Plc | 0.00% | $96.12 | +3.0% | $7.6B | 73.3 | - |
Investor Checkpoints
These are the key factors to check when considering an investment in the DGS ETF. Investors should evaluate the characteristics of emerging market small- and mid-cap stocks as an asset class together with the benefits of dividend weighting.
| Checkpoint | What to Check | Current Status |
|---|---|---|
| 📊 Regional Weighting | Check exposure to major countries such as Taiwan, China, and South Korea | Adequate diversification maintained |
| 💵 Dividend Yield | Review dividend appeal relative to the category average | Remains at a high level |
| 💱 Currency Environment | Check the trend in emerging market currencies against the dollar | Watch for volatility |
| 📉 Valuation | Check for undervaluation using metrics such as the price-to-earnings ratio (PER) | Remains at a low level |
Emerging market small- and mid-cap stocks can be hit harder than large caps during a global economic slowdown, and there is a constant risk of asset value declines from geopolitical risk or regulatory changes in a particular country.
This emerging market product suits investors who want to capture both growth and income. It is highly valuable as a diversification tool that complements a portfolio centered on large-cap stocks.
SubscribeDisclaimer: This content is for informational purposes only and does not constitute investment advice. All investment responsibility lies with the investor.
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