The WisdomTree Europe Equity Income UCITS ETF (EEI) aims to track the performance of the WisdomTree Europe Equity Income Index, which focuses on European companies with strong dividend yields and solid fundamentals. As a result, the ETF offers investors exposure to a diversified portfolio of high-dividend-yielding companies across Europe.
WisdomTree Europe Equity Income UCITS ETF Price & Chart
Designed for income-focused investors, this ETF provides an opportunity to gain access to European markets while benefiting from potential capital appreciation. It is an attractive option for those seeking regular income from their investments and diversification within the European equity space.
The ETF holds stocks listed in various European countries, such as Austria, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Spain, Sweden, Switzerland and the UK. Financial stocks make up over 27% of the ETF, while energy stocks are also well represented.
EEI ETF Performance
The ETF has performed very much as you may expect a dividend-focused fund to perform: Ranging, with a limited or lack of growth.
As an illustration of the lack of volatility, its performance over the last three months (as of January 21, 2025) shows a 1.2% gain, while over the last 12 months, it is down around 8.8%. Here is a summary of its recent performance:
| Year | Performance |
|---|---|
| 2025 (YTD) | +6.5% |
| 2024 | +3.00% |
| 2023 | +14.69% |
| 2022 | -0.65% |
| 2021 | +18.85% |
EEI Top Holdings (as of January 20, 2025)
| Company | Weight |
|---|---|
| HSBC | 6.04% |
| TotalEnergies | 3.63% |
| Equinor | 3.20% |
| ENEL SpA | 3.19% |
| Intesa Sanpaolo | 2.87% |
| Allianz SE | 2.78% |
| Engie | 2.75% |
| Rio Tinto | 2.55% |
| BP | 2.38% |
| Volvo AB | 2.20% |
European Stocks Forecast
Bull Argument: In December (2024), Goldman Sachs Research said in an article that it expects European stocks to rally in 2025. The investment bank's view comes despite the region facing headwinds from political and trade uncertainty and slow economic growth. “The STOXX 600 index, made up of European and UK companies, is forecast to generate a total return of about 9% next year (as of 19 November 2024),” said Goldman Sachs.
The firm anticipates the European Central Bank will bring interest rates down next year and they see “opportunities in more indebted sectors like telecoms, and in areas that are sensitive to interest rates, like real estate.” They added: “European stocks may benefit from cooling inflation, a larger than expected European policy response, or concerns about the prospect for returns from mega-cap US stocks.”
Bear Argument: While the bank expects European stocks to ally, it warned that it has lowered its targets for European stocks in 2025, as Europe has also seen a modest rise in risks. “The stability of the fiscal situation in France, Italy, and to some extent the UK, is being questioned, for example,” said Goldman. “Economic data has been weak, and the manufacturing cycle, which particularly impacts Germany, has been really dire.”
Our View: While the lack of upside momentum may be a significant hurdle for many investors, the WisdomTree Europe Equity Income UCITS ETF is a strong option for income-seeking investors looking to diversify their portfolios with European high-dividend stocks. It has a focus on dividend-paying companies across various sectors which provides a balanced approach for portfolios. Even so, there may be some investors who do not find the fund a suitable match for their portfolios; here's why.
Who Should Buy the WisdomTree Europe Equity Income UCITS ETF?
Not every investment option is an opportunity, as their characteristics and goals may not align with the assets. This ETF is more suitable for:
- Income-focused investors: Obviously, given that the ETF is designed to provide consistent dividend income, it appeals to those seeking regular payouts.
- Risk-averse investors: Furthermore, as we can see with the lack of volatility and significant downside, the ETF's focus on established, high-dividend-yielding companies offers stability, making it a more suitable choice for conservative investors.
- European market investors: Another clear point here is that the fund is more suitable for those looking for exposure to European equities. To take it even further, investors with a preference for European financials or energy stocks may find it even more attractive, given the current sector weighting.
Long-term investors: Overall, dividend stocks generally perform well over the long term, meaning those with a long-term investment horizon may find this ETF preferable.
