WisdomTree is rethinking its strategy behind the Japan Total Dividend Fund (NYSEArca: DXJ) to include a currency hedge element moving forward.

While DXJ currently is a play on Japan's broad equity market, WisdomTree is hoping that hedging currency exposure in the portfolio would protect investors against declines in the Japanese yen.

And a weakening of the yen against the U.S. dollar is exactly what analysts are looking for.

Japan's stock market continues to show modest equity valuations, but the strong yen has weighed on its performance against the broad international market. A weaker yen would translate into better valuations as well as stronger exports.

Compared with other nonhedged Japanese equity funds, DXJ would see higher returns than its counterparts in times of a rising U.S. dollar against the yen, and lower returns when the yen strengthens.

Consider the competition: iShares' take on the Japan's broad equity market fund—the iShares MSCI Japan Index (NYSEArca: EWJ)—is considered the largest, most liquid ETF to provide exposure to Japan's equities. The fund has assets of more than $5 billion, though its price tag is slightly higher than DXJ's, at 56 basis points.

Both EWJ and DXJ have similar sector allocations and similar market capitalization weightings, but EWJ's portfolio is larger, with 327 securities as opposed to DXJ's 256.

Other competitors include the much smaller PowerShares FTSE RAFI Japan Fund (NYSEArca: PJO), which is similar in construction but has only 97 holdings and less than $10 million in assets.

While DXJ has been in the market since mid-2006, its total assets under management remain just shy of $100 million and its cumulative performance has often been in the red. WisdomTree is hoping that the new currency hedge feature will be an attractive, differentiating investment tool for DXJ.

DXJ will be renamed WisdomTree Japan Hedged Equity Fund, but no changes will be made to the ticker or to the expense ratio, currently pegged at 48 basis points. Changes will be effective April 1.

WisdomTree also offers two other plays in the space: the WisdomTree Dreyfus Japanese Yen Fund (NYSEArca: JYF), which is a pure play on the currency space, but provides no exposure to equities, and the WisdomTree Japan SmallCap Dividend Fund (NYSEArca: DFJ), which plays small-caps without any hedged exposure to currency.

You can see details about DXJ here.