It Is Rare To Be #1 (Or #2)

Written by: Christopher Gannatti

Key Takeaways

• As of June 30, 2025, the WisdomTree Efficient Gold Plus Equity Strategy Fund (GDE) ranked first in the Morningstar U.S. Large Blend category over one year and second over both the year-to-date and three-year periods.
   
• GDE's standout performance was powered by a capital-efficient 90/90 structure combining large-cap U.S. equities with gold futures, capturing both mega-cap momentum and a breakout in gold prices during a volatile market environment.
   
• For investors hesitant to choose between equities and gold after strong runs in both, GDE offers a unique strategy to hold dual exposures without diluting core allocations—a potentially game-changing portfolio construction tool.
   

On June 18, 2025, we published the article titled "It Is Rare to Be #1." On a quarterly basis, we have the opportunity to check the Morningstar rankings and see how well we are doing at maintaining this level of relative performance.

It's time to look at the June 30, 2025, data.

In the vast universe of investment strategies, only a select few ever ascend to the absolute top of their peer group—and even fewer stay there. In the highly competitive Morningstar U.S. Large Blend category, which includes titans of index tracking, smart beta innovations and active strategies alike, ranking first over both one-year and three-year horizons is statistically exceptional. It's not just about relative outperformance—it's a signal that something unique is happening under the hood. Out of more than 1,000 contenders,¹ the WisdomTree Efficient Gold Plus Equity Strategy Fund (GDE) achieved precisely that for the period ended March 31, 2025.

As of June 30, 2025, we re-ran the numbers and saw:

• Year-to-date: GDE was the second-best performing strategy in this peer group.

• 1-Year: GDE was the top-performer in this peer group.

• 3-Year: GDE was the second-best performing strategy in this peer group.

• Over the longest available period within the Morningstar Direct system, April 1, 2022, to June 30, 2025, GDE was the top-performer in this peer group.

Figures 1a and 1b show all the pertinent performance data behind these results:

Figure 1a: Standardized Returns

Sources: Morningstar, FactSet and WisdomTree, specifically data is from the PATH Fund Comparison Tool, accessed as of 7/11/25, but showing returns for the period ended 6/30/25. NAV denotes total return performance at net asset value. MP denotes market price performance. The performance data quoted represents past performance and is not indicative of future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the most recent month-end and standardized performance, click here.

Figure 1b: Ranking within the U.S. Large Blend Category

Source: Morningstar Direct. The longest available period is 4/1/22–6/30/25, based on 4/1/22 being the closest next month start relative to GDE's inception on 3/17/22. Morningstar ratings are based on risk-adjusted return. Past performance is not indicative of future results.

What makes GDE's ascent particularly compelling is that it doesn't rely on complicated security selection, precise timing or opaque models. The equity sleeve is straightforward: a market capitalization-weighted allocation to the 500 largest U.S. stocks—a segment that has led equity markets, with mega-cap resilience dominating the performance tables. Notably, from April 8 through June 30, 2025, the U.S. large-cap equity market staged a decisive recovery,² reinforcing the strength of this allocation. But layered onto this equity core is where the innovation lies. GDE overlays gold futures exposure in a capital-efficient structure, using only $10 of collateral for every $90 in gold futures while maintaining full equity exposure. In effect, GDE deploys a 90/90 structure: $90 in equities, $90 in gold and $10 in cash collateral, made possible through the futures market. This layered approach allows investors to hold dual exposures without requiring dual capital commitments.

The period during which GDE climbed to the top of the Morningstar charts coincided with two reinforcing macro trends: the dominance of large-cap U.S. equities and a breakout in gold prices. The strategy didn't just benefit from exposure—it benefitted from efficient exposure. Gold futures have surged amid declining real yields, central bank accumulation and heightened geopolitical risk.³ Meanwhile, U.S. large caps have defied pessimism and rate volatility to deliver strong returns, especially as investors concentrated into a narrow band of mega-cap winners. GDE captured both themes with precision, translating macro-level alignment into benchmark-beating performance. It's rare to be number one, or at least number one in some periods and number two in others.

Conclusion: Hold Gold without Sacrificing Equities

As with any investment strategy, the elements that have driven GDE's standout performance—surging gold prices and strong large-cap equity returns—are not static. Gold, in particular, is notorious for episodes of volatility and long stretches of subdued returns. GDE's embedded leverage, while essential to its capital efficiency, magnifies both gains and losses, introducing risk during periods when either equities or gold underperform. Moreover, the psychological barrier of "I've already missed it" can paralyze investor decision-making, especially when looking at charts already steeped in green. But history shows that gold's price drivers—real interest rates, currency shifts and geopolitical uncertainty—rarely move in a straight line. The environment that pushed gold to new highs in recent quarters may evolve, but it is far from resolved.

Much has been made of 2025's volatility in equity markets so far—we believe many wouldn't realize how GDE has been able to navigate this to significant advantage with the efficient gold exposure.

Figure 2: A Game Changer So Far in 2025

Sources: Morningstar, FactSet and WisdomTree, specifically data is from the PATH Fund Comparison Tool, accessed as of 7/11/25, but showing returns for the period ended 7/10/25. NAV denotes total return performance at net asset value. MP denotes market price performance. Past performance is not indicative of future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the most recent month-end and standardized performance, click here.

One of the most significant advantages of GDE is that it helps investors sidestep a false dilemma: choosing between equity participation and gold exposure. Many are understandably hesitant to shift capital into gold after a strong run, fearing they'll miss out on the next leg higher in equities—especially with mega-cap stocks continuing to drive benchmark returns. But GDE's structure offers a solution that reframes the conversation: it doesn't require an investor to give up equity exposure to gain access to gold. Instead, through capital-efficient layering of gold futures atop a traditional equity core, GDE enables simultaneous participation in both trends. This dual exposure can be a game changer for portfolio construction—preserving upside potential while embedding diversification. While no strategy is without risk, and past performance is no guarantee of future results, GDE offers a thoughtful way to expand opportunity sets without diluting core equity allocations. It's not about timing gold—it's about holding both, smartly.

Related: Fed Watch: See You in September?

¹ Shown in Figure 1b. Source: Morningstar Direct. The longest available period is 4/1/22–6/30/25, based on 4/1/22 being the closest next month start relative to GDE's inception on 3/17/22. Past performance is not indicative of future results.

² Sources: WisdomTree Fund Compare tool within WisdomTree's PATH suite of tools, with underlying data sourced from Morningstar and FactSet.

³ Sources: "How Lower Rates and Central Bank Demand Are Fueling the Gold Rally," Forbes, 3/25/24; "What Does the Record Price of Gold Tell Us about Risk Perceptions in Financial Markets?," European Central Bank, May 2025. https://www.ecb.europa.eu/press/financial-stability-publications/fsr/focus/2025/html/ecb.fsrbox202505_02~7f616fcd3f.en.html

Important Risks Related to this Article

You cannot invest directly in an index.

There are risks associated with investing, including the possible loss of principal. The Fund is actively managed and invests in U.S.-listed gold futures and U.S. equity securities. The Fund’s use of U.S.-listed gold futures contracts will give rise to leverage, magnifying gains and losses and causing the Fund to be more volatile than if it had not been leveraged. Moreover, the price movements in gold and gold futures contracts may fluctuate quickly and dramatically and have a historically low correlation with the returns of the stock and bond markets. U.S. equity securities, such as common stocks, are subject to market, economic and business risks that may cause their prices to fluctuate. The Fund’s investment strategy will also require it to redeem shares for cash or to otherwise include cash as part of its redemption proceeds, which may cause the Fund to recognize capital gains. Please read the Fund’s prospectus for specific details regarding the Fund’s risk profile.

Morningstar, Inc., 2019. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers is responsible for any damages or losses arising from any use of this information. Past performance, rankings and ratings are no guarantee of future results. The % of Peer Group Beaten is the fund’s total-return percentile rank compared to all funds within the same Morningstar Category and is subject to change each month. Regarding ranking of funds, 1 = Best.

Past performance is not indicative of future results.

U.S. investors only: Click here to obtain a WisdomTree ETF prospectus which contains investment objectives, risks, charges, expenses, and other information; read and consider carefully before investing.

WisdomTree Funds are distributed by Foreside Fund Services, LLC, in the U.S.

This WisdomTree article is provided as part of a paid sponsorship.