Across the Drawbridge to Global Moats
Building on the success and popularity of VanEck Vectors® Morningstar Wide Moat ETF (MOAT®) and its underlying index’s approach to investing in the U.S., VanEck launched MOTI in 2015 to expand investor access to Morningstar’s core equity research in the international arena.
MOTI seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the Morningstar® Global ex-US Moat Focus IndexSM (MGEUMFUN). The index is intended to track the overall performance of companies outside the U.S. with sustainable competitive advantages that are also attractively priced, according to Morningstar’s equity research team.
Building on the popularity of domestic-focused ETF
The VanEck Vectors Morningstar Wide Moat ETF (MOAT) tracks the price and yield performance of the Morningstar Wide Moat Focus Index. The index comprises US-based wide-moats stocks (PII)(VFC) trading at a discount to their intrinsic value, as determined by Morningstar’s proprietary research methodology. The MOAT ETF has assets under management of $1.3 billion as of October 31, and it counts 49 stocks in its portfolio. Over the last five years, MOAT earned 15.3% returns compared to 15.2% for the benchmark S&P 500 Index (SPX-INDEX)(SPY).
With the launch of the VanEck Vectors Morningstar International Moat ETF (MOTI), the investment focus extended to cover international moat companies. The Morningstar Global ex-US Moat Focus Index, the underlying index of the MOTI ETF, provides exposure to ex-US quality companies in both developed and emerging markets that offer a wide or narrow moat. Stocks are selected based on their relative attractiveness compared to Morningstar’s fair value estimates.
MOTI’s portfolio exposure is widely distributed across developed and emerging markets. China leads the portfolio with net asset exposure of 17.11% as of October 31. Australia is at the second spot at 12.37%, followed by Japan, France, Germany, and Singapore with weights of 9.77% 8.24%, 8.19%, and 7.39%, respectively.