DIM ETF a Bright Play

A lot of investors are interested in assembling a diversified portfolio using just a handful of exchange-traded funds. Like all strategies, this has its positive and negative points. The biggest drawback to ETF-only investing is that dividend yields are lower than might be available with a diversified portfolio of common stocks.

Recently, the New York investment-management firm WisdomTree brought 20 new ETFs to the market that help offset the dividend issue. The WisdomTree funds are constructed with an innovative methodology that weights fund components by their dividends, rather than by market cap, so the ETFs yield more than similar funds from other providers.

In addition to the use of dividends in the index construction, the WisdomTree funds capture parts of the market that aren't touched by other ETFs. Among those that are specifically unique are the funds that invest in small- and mid-cap stocks in regions outside the U.S.

There are a lot to explore, but the first one that caught my eye is the WisdomTree International MidCap Dividend Index(DIM Quote) fund, or DIM. ...