Despite the recent pullback, many investors still maintain a bullish market outlook. Nevertheless, ETF investors and financial advisors should monitor the pulse of the market in case of any sudden shifts.
“I think we’re in the late stage of a bull market,” Luciano Siracusano, Chief Investment Strategist at WisdomTree Asset Management, said at the Inside ETFs 2018 conference. “I think you need to be careful. I wouldn’t be 100% beta all the time, going forward.”
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Specifically, Siracusano argued that investors should look to large-cap quality if they are sticking around in the U.S. markets.
For instance, ETF investors can look to something like the WisdomTree U.S. Quality Shareholder Yield Fund (NYSEArca: QSY) or the WisdomTree U.S. Quality Dividend Growth Fund (NASDAQ: DGRW) as a way to hone in on quality names. QSY tracks those with a high total shareholder yield and favorable quality attributes while DGRW screens for large-cap dividend growing companies with a quality and growth factor.
Investors may also find opportunities in overseas markets, especially as international stocks trade at much more attractive valuations relative to the lofty prices in U.S. markets, especially those in the emerging markets.
Siracusano also highlighted the benefits of the WisdomTree Emerging Markets ex-State-Owned Enterprises Fund (NYSEArca: XSOE) as a way to tap into emerging opportunities. XSOE has been outperforming the broader emerging markets and the benchmark MSCI Emerging Markets Index over the past year.
“Right now you’re getting an earnings pick up in emerging markets,” Siracusano added. “We think the key to emerging markets today is to be able to get the non-state-owned enterprise companies… you got another thousand basis points just by getting pure private sector beta exposure without the government looking over these companies.”
WisdomTree Investments, which is more known for its lineup of ETFs, has also rolled out the WisdomTree Advisor Solutions platform to provide financial advisors more tools to grow and scale their businesses.
“Our existence was all about providing those better investment solutions, and now, we’re partnering that up with better business solutions for our clients,” Alisa Maute, Head of US Distribution for WisdomTree Asset Management, said at the conference.
The new program provides investment research and ETF education; portfolio construction services; ETF Model Portfolios; practice management resources, like access to thought leaders in retirement planning, leadership and behavioral finance; and wealth management technology through AdvisorEngine, a customizable end-to-end platform for advisors that offers access to Kredible by AdvisorEngine, an online credibility optimizer.
For more ETF-related commentary from Tom Lydon and other industry experts, visit our video category.
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