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Is VanEck Morningstar Wide Moat ETF (MOAT) a Strong ETF Right Now?
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Making its debut on 04/24/2012, smart beta exchange traded fund VanEck Morningstar Wide Moat ETF (MOAT - Free Report) provides investors broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
The fund is managed by Van Eck, and has been able to amass over $6.27 billion, which makes it one of the larger ETFs in the Style Box - Large Cap Blend. This particular fund, before fees and expenses, seeks to match the performance of the Morningstar Wide Moat Focus Index.
The Morningstar Wide Moat Focus Index tracks the overall performance of the 20 most attractively priced companies with sustainable competitive advantages.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for this ETF are 0.46%, making it on par with most peer products in the space.
MOAT's 12-month trailing dividend yield is 1.28%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
For MOAT, it has heaviest allocation in the Information Technology sector --about 29.20% of the portfolio --while Industrials and Healthcare round out the top three.
When you look at individual holdings, Kellogg Co (K - Free Report) accounts for about 3.06% of the fund's total assets, followed by Polaris Inc (PII - Free Report) and Veeva Systems Inc (VEEV - Free Report) .
Its top 10 holdings account for approximately 27.06% of MOAT's total assets under management.
Performance and Risk
Year-to-date, the VanEck Morningstar Wide Moat ETF has lost about -16.23% so far, and is down about -11.75% over the last 12 months (as of 10/05/2022). MOAT has traded between $59.82 and $78.14 in this past 52-week period.
MOAT has a beta of 1.02 and standard deviation of 24.64% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 51 holdings, it effectively diversifies company-specific risk.
Alternatives
VanEck Morningstar Wide Moat ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $283.91 billion in assets, SPDR S&P 500 ETF has $346.33 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Blend.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Is VanEck Morningstar Wide Moat ETF (MOAT) a Strong ETF Right Now?
Making its debut on 04/24/2012, smart beta exchange traded fund VanEck Morningstar Wide Moat ETF (MOAT - Free Report) provides investors broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
The fund is managed by Van Eck, and has been able to amass over $6.27 billion, which makes it one of the larger ETFs in the Style Box - Large Cap Blend. This particular fund, before fees and expenses, seeks to match the performance of the Morningstar Wide Moat Focus Index.
The Morningstar Wide Moat Focus Index tracks the overall performance of the 20 most attractively priced companies with sustainable competitive advantages.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for this ETF are 0.46%, making it on par with most peer products in the space.
MOAT's 12-month trailing dividend yield is 1.28%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
For MOAT, it has heaviest allocation in the Information Technology sector --about 29.20% of the portfolio --while Industrials and Healthcare round out the top three.
When you look at individual holdings, Kellogg Co (K - Free Report) accounts for about 3.06% of the fund's total assets, followed by Polaris Inc (PII - Free Report) and Veeva Systems Inc (VEEV - Free Report) .
Its top 10 holdings account for approximately 27.06% of MOAT's total assets under management.
Performance and Risk
Year-to-date, the VanEck Morningstar Wide Moat ETF has lost about -16.23% so far, and is down about -11.75% over the last 12 months (as of 10/05/2022). MOAT has traded between $59.82 and $78.14 in this past 52-week period.
MOAT has a beta of 1.02 and standard deviation of 24.64% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 51 holdings, it effectively diversifies company-specific risk.
Alternatives
VanEck Morningstar Wide Moat ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $283.91 billion in assets, SPDR S&P 500 ETF has $346.33 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Blend.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.