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Should VanEck Morningstar Wide Moat ETF (MOAT) Be on Your Investing Radar?

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If you're interested in broad exposure to the Large Cap Blend segment of the US equity market, look no further than the VanEck Morningstar Wide Moat ETF (MOAT - Free Report) , a passively managed exchange traded fund launched on 04/24/2012.

The fund is sponsored by Van Eck. It has amassed assets over $6.76 billion, making it one of the largest ETFs attempting to match the Large Cap Blend segment of the US equity market.

Why Large Cap Blend

Large cap companies usually have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.

Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.


Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.

Annual operating expenses for this ETF are 0.46%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.19%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Information Technology sector--about 25% of the portfolio. Healthcare and Consumer Staples round out the top three.

Looking at individual holdings, Cheniere Energy Inc (LNG - Free Report) accounts for about 3.62% of total assets, followed by Lockheed Martin Corp (LMT - Free Report) and Berkshire Hathaway Inc (BRK/B).

The top 10 holdings account for about 29.94% of total assets under management.

Performance and Risk

MOAT seeks to match the performance of the Morningstar Wide Moat Focus Index before fees and expenses. The Morningstar Wide Moat Focus Index tracks the overall performance of the 20 most attractively priced companies with sustainable competitive advantages.

The ETF has lost about -9.83% so far this year and is down about -4.77% in the last one year (as of 06/01/2022). In the past 52-week period, it has traded between $65.37 and $78.14.

The ETF has a beta of 1.01 and standard deviation of 23.25% for the trailing three-year period, making it a medium risk choice in the space. With about 48 holdings, it has more concentrated exposure than peers.


VanEck Morningstar Wide Moat ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, MOAT is a good option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.

The iShares Core S&P 500 ETF (IVV - Free Report) and the SPDR S&P 500 ETF (SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $301.13 billion in assets, SPDR S&P 500 ETF has $380.01 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.


While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.

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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