The WisdomTree Cloud Computing ETF (WCLD) made its debut on 09/06/2019, and is a smart beta exchange traded fund that provides broad exposure to the Technology ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by Wisdomtree, and has been able to amass over $249.99 million, which makes it one of the average sized ETFs in the Technology ETFs. WCLD seeks to match the performance of the BVP NASDAQ EMERGING CLOUD INDEX before fees and expenses.
The BVP Nasdaq Emerging Cloud Index is an equally weighted Index, designed to measure the performance of emerging public companies focused on delivering cloud-based software to customers.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for WCLD are 0.45%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.00%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Representing 93.2% of the portfolio, the fund has heaviest allocation to the Information Technology sector.
When you look at individual holdings, Fastly Inc - Class A (FSLY) accounts for about 2.87% of the fund's total assets, followed by Digitalocean Holdings Inc (DOCN) and Braze Inc-a (BRZE).
Its top 10 holdings account for approximately 19.89% of WCLD's total assets under management.
Performance and Risk
Year-to-date, the WisdomTree Cloud Computing ETF has lost about -8.44% so far, and is down about -11.3% over the last 12 months (as of 07/01/2026). WCLD has traded between $24.09 $36.88 in this past 52-week period.
The ETF has a beta of 1.10 and standard deviation of 30.57% for the trailing three-year period. With about 66 holdings, it effectively diversifies company-specific risk .
Alternatives
WisdomTree Cloud Computing ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Global X Cloud Computing ETF (CLOU) tracks INDXX GLOBAL CLOUD COMPUTING INDEX and the First Trust Cloud Computing ETF (SKYY) tracks ISE Cloud Computing Index. Global X Cloud Computing ETF has $228.18 million in assets, First Trust Cloud Computing ETF has $2.74 billion. CLOU has an expense ratio of 0.68% and SKYY changes 0.60%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology ETFs
Bottom Line
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WisdomTree Cloud Computing ETF (WCLD): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).