WisdomTree U.S. Earnings 500 Fund (EPS US) – Portfolio Construction Methodology

The underlying WisdomTree U.S. LargeCap Index offers a fundamentals-weighted take on U.S. large caps. It selects the 500 largest companies by market cap from the WisdomTree U.S. Total Market Index that have generated positive cumulative earnings over the most recent four fiscal quarters. A composite risk screen excludes the bottom decile by a quality-and-momentum score (industry-relative ROE, ROA, gross profits and cash-flow metrics; 6- and 12-month risk-adjusted returns). Constituents are earnings-weighted so each company’s weight reflects its proportionate share of aggregate core earnings. To curb concentration and turnover, sector weights are constrained to be within 5% of a market-cap-weighted version of the eligible set, and single-name weights are bounded between one-third and three times their market-cap analogs. The index is reconstituted and reweighted annually each December.

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