(USMF) WisdomTree U.S. Multifactor - Ratings and Ratios

The WisdomTree U.S. Multifactor Fund (USMF) is an exchange-traded fund (ETF) that primarily invests in U.S. companies selected based on a combination of fundamental and technical factors. Under normal market conditions, the fund allocates at least 80% of its total assets to securities that match the economic characteristics of its underlying index or to derivatives that replicate such characteristics. This approach allows the fund to maintain exposure to the index while managing risk through diversification or hedging strategies.

The funds underlying index is designed to track the performance of 200 U.S. companies with the highest composite scores based on two fundamental factors—value and quality measures—and two technical factors—momentum and correlation. The value factor assesses metrics such as price-to-earnings and price-to-book ratios, while the quality factor evaluates financial health through measures like return on equity and debt-to-equity ratios. Momentum is determined by recent price performance and earnings trends, while correlation measures how closely the securities returns align with the broader market. This multi-factor approach aims to balance risk and return by combining complementary investment strategies.

As a non-diversified fund, USMF can invest a significant portion of its assets in a limited number of securities, which may amplify risk but also offers the potential for higher returns. The funds mid-cap blend category indicates its focus on medium-sized companies with a mix of growth and value characteristics. With an average daily trading volume of 46,258 shares and assets under management (AUM) of $368.59 million, the fund operates with moderate liquidity, making it accessible to a range of investors.

From a technical standpoint, USMF is trading at $50.80 with a 20-day moving average of $51.49, indicating slight bearish momentum in the short term. The 50-day moving average of $50.78 suggests a neutral trend, while the 200-day moving average of $48.44 reflects a longer-term bullish trend. The average true range (ATR) of 0.51 highlights moderate volatility, suggesting that the funds price movements are relatively stable.

Over the next three months, based on the current technical and fundamental data, USMF is likely to experience a sideways to slightly upward trend. The 50-day and 200-day moving averages suggest underlying strength, while the ATR indicates manageable volatility. However, the funds non-diversified nature and focus on mid-cap companies could lead to heightened sensitivity to market fluctuations. Investors should monitor the funds liquidity and the performance of its underlying index to assess potential risks and opportunities.