VanEck VectorsTM Morningstar Wide Moat ETF (MOAT®) seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the Morningstar Wide Moat Focus Index. Listed in 2012, MOAT is the only U.S. exchange-traded fund to provide access to Morningstar’s top U.S. stock picks.
Market Realist – The VanEck Vectors Morningstar Wide Moat ETF
The VanEck Vectors Morningstar Wide Moat ETF (MOAT) tracks the price and yield performance of the Morningstar Wide Moat Focus Index. According to Morningstar’s equity research team, the index is intended to track the overall performance of attractively priced companies (TIF) (MSFT) with sustainable competitive advantages. The index comprises US-based wide-moats stocks (HOG) (TWX) that are trading at a discount to their intrinsic value, as determined by Morningstar’s proprietary research methodology.
Market Realist – Portfolio rebalancing
Morningstar introduced a number of changes to the Morningstar Wide Moat Focus Index construction rules starting June 20, 2016. With these changes, the number of constituents of the index rose from 20 to at least 40 and modified its rebalance and reconstitution methodology. The changes are likely to result in more diversified exposure, lower turnover, and longer holding periods for index constituents.
As of October 31, 2016, the MOAT ETF comprised 44 stocks. The MOAT is heavily tilted toward consumer discretionary and the healthcare sector, together accounting for around 47.9% of the portfolio. The financial sector comprised 15.7% of the total portfolio followed by industrials (14.1%), information technology (13.2%), and materials (4.8%).