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

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The VanEck Morningstar Wide Moat ETF (MOAT - Free Report) was launched on 04/24/2012, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Blend segment of the US equity market.

The fund is sponsored by Van Eck. It has amassed assets over $6.67 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

Companies that find themselves in the large cap category typically have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.

Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.


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 1.18%.

Sector Exposure and Top Holdings

ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Information Technology sector--about 24.90% of the portfolio. Healthcare and Consumer Staples round out the top three.

Looking at individual holdings, Kellogg Co (K - Free Report) accounts for about 3.01% of total assets, followed by Gilead Sciences Inc (GILD - Free Report) and Biogen Inc (BIIB - Free Report) .

The top 10 holdings account for about 27% 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 -8.91% so far this year and is down about -6.39% in the last one year (as of 08/03/2022). In the past 52-week period, it has traded between $61.32 and $78.14.

The ETF has a beta of 1.01 and standard deviation of 24.02% for the trailing three-year period, making it a medium risk choice in the space. With about 51 holdings, it effectively diversifies company-specific risk.


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 $303.58 billion in assets, SPDR S&P 500 ETF has $369.76 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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