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Is VanEck Morningstar Wide Moat ETF (MOAT) a Strong ETF Right Now?
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The VanEck Morningstar Wide Moat ETF (MOAT - Free Report) was launched on 04/24/2012, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
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.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Because the fund has amassed over $14.25 billion, this makes it one of the largest ETFs in the Style Box - Large Cap Blend. MOAT is managed by Van Eck. 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
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 0.47%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.85%.
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 in the Healthcare sector - about 19.90% of the portfolio. Industrials and Information Technology round out the top three.
When you look at individual holdings, Teradyne Inc (TER - Free Report) accounts for about 3.41% of the fund's total assets, followed by Alphabet Inc (GOOGL - Free Report) and International Flavors & Fragrances Inc (IFF - Free Report) .
Its top 10 holdings account for approximately 28.42% of MOAT's total assets under management.
Performance and Risk
So far this year, MOAT return is roughly 1.57%, and is up about 10.71% in the last one year (as of 07/09/2024). During this past 52-week period, the fund has traded between $70.71 and $89.90.
The fund has a beta of 1.02 and standard deviation of 19.04% for the trailing three-year period, which makes MOAT a medium risk choice in this particular space. With about 56 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 $503.49 billion in assets, SPDR S&P 500 ETF has $551.77 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?
The VanEck Morningstar Wide Moat ETF (MOAT - Free Report) was launched on 04/24/2012, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
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.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Because the fund has amassed over $14.25 billion, this makes it one of the largest ETFs in the Style Box - Large Cap Blend. MOAT is managed by Van Eck. 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
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 0.47%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.85%.
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 in the Healthcare sector - about 19.90% of the portfolio. Industrials and Information Technology round out the top three.
When you look at individual holdings, Teradyne Inc (TER - Free Report) accounts for about 3.41% of the fund's total assets, followed by Alphabet Inc (GOOGL - Free Report) and International Flavors & Fragrances Inc (IFF - Free Report) .
Its top 10 holdings account for approximately 28.42% of MOAT's total assets under management.
Performance and Risk
So far this year, MOAT return is roughly 1.57%, and is up about 10.71% in the last one year (as of 07/09/2024). During this past 52-week period, the fund has traded between $70.71 and $89.90.
The fund has a beta of 1.02 and standard deviation of 19.04% for the trailing three-year period, which makes MOAT a medium risk choice in this particular space. With about 56 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 $503.49 billion in assets, SPDR S&P 500 ETF has $551.77 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.