WisdomTree Emerging Markets Small Cap Dividend Fund (DGS US) – Portfolio Construction Methodology

The underlying WisdomTree Emerging Markets SmallCap Dividend Index targets small-cap dividend payers from emerging markets. Starting with the WisdomTree Emerging Markets Dividend Index, companies in the bottom 10% of aggregate market cap are eligible; incumbents are removed only if they fall outside the bottom 13% at the next annual screen, creating a buffer. Components must meet WisdomTree’s investability rules (regular cash dividends, minimum liquidity) and pass a composite risk filter; eligible China A-shares via Stock Connect are admitted under the same rules. Constituents are dividend-weighted by projected cash dividends, with sector and country concentration capped (aggregate sector and country exposures limited, with stricter limits for Real Estate and China A), and extreme single-stock sizes reduced by the standard capping framework. The index is screened and reconstituted annually on an emerging-markets schedule each autumn.

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