Many retirees face the same question when planning income in retirement: should the focus be on high yield or long-term growth? That trade-off helps explain why some investors still choose the WisdomTree U.S. LargeCap Fund (EPS) even though its dividend yield sits at only 1.21%.
At first glance, that yield looks small. After all, the 10-year U.S. Treasury currently pays about 4.13%. So why would retirees consider an ETF with a lower payout? The answer lies in how the fund is built and what it aims to deliver over time.
Unlike typical S&P 500 index funds, EPS does not weight companies by market value. Instead, it uses an earnings-based approach. Companies that generate higher profits receive larger allocations in the portfolio. In simple terms, the fund gives more space to businesses that actually earn more money rather than just those with the biggest stock market value.
What supports the Fund’s income
The ETF holds more than 500 large U.S. companies across many industries. That wide mix helps protect the income stream. If one company cuts its dividend, the overall impact remains limited because hundreds of other firms still contribute payments.
Dividend income comes directly from the companies inside the portfolio. During 2025, quarterly distributions ranged from $0.195 in the first quarter to $0.245 in the fourth quarter. The fund has also kept uninterrupted quarterly payments since launching in February 2007, even through recessions and market disruptions.
Another factor supporting the strategy is the strength of corporate profits. U.S. corporate profits reached about $4.1 trillion in the third quarter of 2025, marking a 9.3% increase year over year. Stronger profits naturally benefit a fund that weights companies by earnings.
Total returns tell the story
Still, the real appeal for many investors goes beyond the dividend. Over the past year, EPS gained 16.88%, while its five-year return reached 81.83%. The fund is slightly lower year-to-date in 2026, down 1.31%, reflecting broader market softness.
If you’re a retiree, the choice often comes down to your priorities. Is steady income today more important, or does a mix of income and long-term growth make more sense? EPS leans toward the second option.
