WisdomTree DLS & DGS for International Small Cap Value tilt?

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Topic Author
YRT70
Posts: 187
Joined: Sat Apr 27, 2019 8:51 am

WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by YRT70 » Mon Jul 08, 2019 10:46 am

Are WisdomTree DLS & DGS good choices to achieve an International Small Cap Value tilt?

I know they pay dividend, that's not an issue for me. I know their TER is relatively high but the performance seems to make up for it.

I've read Paul Merriman thinks their good choices for SCV.

What are your thoughts on these funds, for someone that wants to tilt to SCV?

caklim00
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by caklim00 » Mon Jul 08, 2019 10:51 am

YRT70 wrote:
Mon Jul 08, 2019 10:46 am
Are WisdomTree DLS & DGS good choices to achieve an International Small Cap Value tilt?

I know they pay dividend, that's not an issue for me. I know their TER is relatively high but the performance seems to make up for it.

I've read Paul Merriman thinks their good choices for SCV.

What are your thoughts on these funds, for someone that wants to tilt to SCV?
I used DLS/DGS exclusively starting a little over 10 years ago. I now use ISCF instead of DLS as its cheaper plus includes a value tilt. I now have access to DFA EM Value DFEVX which is an all cap value fund so I'm using that instead of DGS now, but I know that most don't have access to DFEVX.

All I hold in my IRAs now are ISCF (Intl SC Multifactor) and SLYV (S&P 600 Value).
Last edited by caklim00 on Mon Jul 08, 2019 11:00 am, edited 1 time in total.

livesoft
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by livesoft » Mon Jul 08, 2019 10:57 am

I have used DLS and DGS. I have substantial assets in DGS and it is one of the reasons that my portfolio is underperforming something like Vanguard LifeStrategy Moderate Growth. You know there are tariffs with no end in sight, right?
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nedsaid
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by nedsaid » Mon Jul 08, 2019 11:09 am

I do own the Wisdom Tree ETF product for International Small-Cap, it was the best product available through Fidelity. So far, I have had a slightly negative return in this ETF, just bought it back in October 2018.
A fool and his money are good for business.

rascott
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by rascott » Mon Jul 08, 2019 11:34 am

I use DGS for EM. Seems a reasonable choice.

palaheel
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by palaheel » Mon Jul 08, 2019 2:00 pm

My 401k has DFA Emerging Markets Value, DFEVX. It's a large cap value fund, with a little mid-cap value. DGS is a mid/small cap value ETF. I mix them, as either one is missing something I want.
Markets crash. Markets recover. Inflation takes your money FOREVER.

Topic Author
YRT70
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by YRT70 » Tue Jul 09, 2019 12:33 pm

Thanks for the feedback guys. Good to see I'm not the only one ;)

caklim00
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by caklim00 » Tue Jul 09, 2019 3:36 pm

palaheel wrote:
Mon Jul 08, 2019 2:00 pm
My 401k has DFA Emerging Markets Value, DFEVX. It's a large cap value fund, with a little mid-cap value. DGS is a mid/small cap value ETF. I mix them, as either one is missing something I want.
Interestingly DFEVX actually holds slightly more micro than DGS according to morningstar. First Column is the fund, second is benchmark, third is category average. DFEVX has always been an All Cap Value fund. Looks to be about a 1/3 Giant, 1/3 Large, 1/3 med/small/micro. DVEVX is significantly smaller than a non-tilted EM fund like VWO (~8M avg market cap vs ~30M avg market cap)

DFEVX
Giant 32.48 53.81 62.01
Large 35.26 33.28 19.81
Medium 20.60 12.20 15.10
Small 7.76 0.68 3.03
Micro 3.91 0.03 0.06

DGS
Giant 0.00 53.81 62.01
Large 6.00 33.28 19.81
Medium 64.76 12.20 15.10
Small 25.65 0.68 3.03
Micro 3.59 0.03 0.06

palaheel
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by palaheel » Tue Jul 09, 2019 4:50 pm

You're looking at the Market Capitalization numbers comparing DFEVX with the benchmark and category average. Here's the M* style box I see:

44 16 09
14 05 02
09 02 00

That looks pretty heavily large cap value to me (44% of the portfolio). Only 11% of the portfolio is small cap.
Markets crash. Markets recover. Inflation takes your money FOREVER.

AndroAsc
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by AndroAsc » Tue Jul 09, 2019 9:49 pm

caklim00 wrote:
Mon Jul 08, 2019 10:51 am
YRT70 wrote:
Mon Jul 08, 2019 10:46 am
Are WisdomTree DLS & DGS good choices to achieve an International Small Cap Value tilt?

I know they pay dividend, that's not an issue for me. I know their TER is relatively high but the performance seems to make up for it.

I've read Paul Merriman thinks their good choices for SCV.

What are your thoughts on these funds, for someone that wants to tilt to SCV?
I used DLS/DGS exclusively starting a little over 10 years ago. I now use ISCF instead of DLS as its cheaper plus includes a value tilt. I now have access to DFA EM Value DFEVX which is an all cap value fund so I'm using that instead of DGS now, but I know that most don't have access to DFEVX.

All I hold in my IRAs now are ISCF (Intl SC Multifactor) and SLYV (S&P 600 Value).
Why ISCF? Morningstar X-ray indicates that DLS and DGS are way more value-y than ISCF.

fennewaldaj
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by fennewaldaj » Tue Jul 09, 2019 11:17 pm

AndroAsc wrote:
Tue Jul 09, 2019 9:49 pm
caklim00 wrote:
Mon Jul 08, 2019 10:51 am
YRT70 wrote:
Mon Jul 08, 2019 10:46 am
Are WisdomTree DLS & DGS good choices to achieve an International Small Cap Value tilt?

I know they pay dividend, that's not an issue for me. I know their TER is relatively high but the performance seems to make up for it.

I've read Paul Merriman thinks their good choices for SCV.

What are your thoughts on these funds, for someone that wants to tilt to SCV?
I used DLS/DGS exclusively starting a little over 10 years ago. I now use ISCF instead of DLS as its cheaper plus includes a value tilt. I now have access to DFA EM Value DFEVX which is an all cap value fund so I'm using that instead of DGS now, but I know that most don't have access to DFEVX.

All I hold in my IRAs now are ISCF (Intl SC Multifactor) and SLYV (S&P 600 Value).
Why ISCF? Morningstar X-ray indicates that DLS and DGS are way more value-y than ISCF.
While DLS is more value-y I think the the reason ISCF looks like it has a growth tilt by style boxes is that is has better growth numbers. The morningstar methodology is a combined score with good growth numbers pulling it one way and good value numbers pulling it the other way. If you compare the value measures of ISCF to the neutral index you see all of them are more value-y than the index.

Topic Author
YRT70
Posts: 187
Joined: Sat Apr 27, 2019 8:51 am

Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by YRT70 » Wed Jul 10, 2019 7:32 am

AndroAsc wrote:
Tue Jul 09, 2019 9:49 pm
Why ISCF? Morningstar X-ray indicates that DLS and DGS are way more value-y than ISCF.
I was thinking the same thing. I guess it's because ISCF is also trying to capture the momentum factor, which offloads on value.

NMBob
Posts: 187
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Re: WisdomTree DLS & DGS for International Small Cap Value tilt?

Post by NMBob » Thu Jul 11, 2019 9:01 pm

If you plug DLS into portfolio visualizer you get that it has .86 US market correlation and a CAGR of 3.88%. Seems there should be several better options for higher returns or less US market correlation. Is this tilt really helping people?

Portfolio Initial Balance Final Balance CAGR Stdev Best Year Worst Year Max. Drawdown Sharpe Ratio Sortino Ratio US Mkt Correlation
Portfolio 1 $10,000 $16,089 3.88% 18.31% 37.16% -44.35% -60.75% 0.26 0.35 0.86
VG 500 Index r $10,000 $26,632 8.15% 14.82% 32.18% -37.02% -50.97% 0.55 0.78 1.00

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