Is the WisdomTree U.S. MidCap ETF (EZM) Currently a Solid Choice?

Overview of the WisdomTree U.S. MidCap ETF (EZM)

The WisdomTree U.S. MidCap ETF (EZM) offers investors access to the mid-cap value segment of the market through a smart beta approach. This exchange traded fund, introduced on February 23, 2007, is designed to provide diversified exposure within this category.

Understanding Smart Beta ETFs

Traditionally, most ETFs have tracked market capitalization-weighted indexes, which aim to mirror the performance of the overall market or specific market segments. These funds are popular among investors who believe in market efficiency, as they offer a cost-effective, straightforward, and transparent way to achieve market returns.

On the other hand, some investors seek to outperform the market by selecting funds that follow alternative, non-market cap weighted strategies—known as smart beta. These strategies use specific fundamental factors or a blend of characteristics to identify stocks with potentially superior risk-adjusted returns.

Smart beta ETFs come in various forms, from simple equal-weighted models to more complex approaches based on fundamentals, volatility, or momentum. However, not all smart beta methodologies have consistently delivered outstanding results.

About the Fund and Its Index

WisdomTree serves as the sponsor for this fund, which manages over $871 million in assets—placing it among the mid-sized ETFs in the mid-cap value space. EZM seeks to replicate the performance of the WisdomTree U.S. MidCap Earnings Index, before fees and expenses.

The underlying index is fundamentally weighted and focuses on U.S. mid-cap companies that generate earnings, offering a unique approach compared to traditional market cap-weighted indexes.

Fees and Expenses

Expense ratios are a key consideration for ETF investors, as lower costs can enhance long-term returns if all other factors are equal. EZM charges an annual operating expense of 0.38%, which is comparable to similar funds in its category. The ETF also provides a 12-month trailing dividend yield of 1.31%.

Sector Allocation and Major Holdings

ETFs are known for their transparency, typically disclosing holdings daily and offering broad diversification to reduce individual stock risk. Nonetheless, it remains important for investors to review a fund’s portfolio.

EZM allocates the largest portion of its assets—18.7%—to the Industrials sector, with Financials and Consumer Discretionary sectors following closely behind. Top individual holdings include Viatris Inc (VTRS) at 1.32% of assets, along with AES Corp (AES) and CF Industries Holdings Inc (CF). The fund’s ten largest positions collectively make up about 7.31% of total assets.

Performance and Risk Profile

Year-to-date, EZM has gained approximately 5.84%, and over the past year (as of February 26, 2026), it has risen by about 14.24%. During the last 52 weeks, the ETF’s price ranged from $51.81 to $71.83.

With a beta of 1.06 and a three-year standard deviation of 19.04%, EZM is considered a moderate risk option within its category. The fund holds around 512 stocks, helping to further diversify company-specific risks.

Other Options to Consider

EZM is a solid choice for those aiming to outperform the mid-cap value segment, but alternative ETFs are available. For example, the iShares Russell Mid-Cap Value ETF (IWS) tracks the Russell MidCap Value Index and holds $15.21 billion in assets, while the Vanguard Mid-Cap Value ETF (VOE) tracks the CRSP U.S. Mid Cap Value Index and manages $22.07 billion. IWS has an expense ratio of 0.23%, and VOE charges just 0.05%.

Investors seeking lower costs and reduced risk may prefer traditional market cap-weighted ETFs that aim to match the returns of the mid-cap value segment.

Conclusion