Starting March 31, the WisdomTree Japan Total Dividend Fund will be renamed the WisdomTree Japan Hedged Equity Fund and, while still providing the same equity exposure and using its dividend-weighting methodology, begin to hedge Japanese yen exposure against the U.S. dollar.
“Many investors believe that the Japanese equity markets have performed poorly recently because their exporting companies have been significantly plagued by the strength of the Japanese yen,” said Bruce Lavine, president and chief operating officer of WisdomTree. “If the yen were to weaken, many would consider that to be a catalyst for rising exports and for the Japanese equity markets to outperform broader international markets.
“We believe the change to hedge DXJ’s currency exposure not only makes for an intriguing investment product but also helps to significantly differentiate the fund from other existing Japan ETFs and unhedged mutual funds,” Lavine added.
This will be WisdomTree’s second currency hedged ETF, the first being the WisdomTree International Hedged Equity Fund which tracks the WisdomTree DEFA Index, an alternative to the MSCI EAFE Index. The fund aims to neutralize currency movements in the countries represented in the index.