Swimming in A Wide Moat 

Jim Woods

Jim Woods has over 20 years of experience in the markets from working as a stockbroker, financial journalist, and money manager.

One trait found among many successful companies is the quality of competitive advantage, or “moat.” 

Advertisement.

This means that competing with these companies is difficult, whether due to significant barriers to entry in the industry or other factors such as important patents. VanEck Morningstar Wide Moat ETF (MOAT) is an exchange-traded fund (ETF) that invests in an equal-weighted basket of U.S. companies determined by stock rater Morningstar to be among the “wide moat” companies with the highest fair values and subjective economic rating.

The companies among MOAT’s holdings span a variety of industries, from tech and biotech firms to giants like Amazon (AMZN) and Wells Fargo (WFC). 

Year to date, this fund has struggled by dropping 20%. However, over a longer time frame, its performance follows a fundamentally upward trajectory, as its value doubled in a less than four-year span from mid-2018 to earlier this year. It has recently begun to recover from a precipitous October tumble, along with much of the market. But its strategy may be more useful for long-term performance than short-term variation.

Advertisement.

Chart courtesy of www.StockCharts.com

The ETF’s expense ratio of 0.47% is ordinary and easily more than paid for by its 1.37% dividend yield. Nearly $6 billion in net assets makes MOAT a relatively heavy hitter.

Among the stocks owned by this fund are Biogen Inc. (BIIB), 3.47%; Etsy, Inc. (ETSY), 2.98%; MercadoLibre, Inc. (MELI), 2.92%; Gilead Sciences, Inc. (GILD); and Wells Fargo & Co. (WFC), 2.83%. Because the fund pursues an equal-weighting strategy, all 40 companies impact its performance roughly equally, though there can be some variation because the fund is rebalanced on a staggered quarterly basis.

Advertisement.

For investors wo are interested in the strategy of investing in companies that are difficult to compete against, VanEck Morningstar Wide Moat ETF (MOAT) provides a diverse collection of 40 stocks based around that exact thesis.

Exclusive  Day Trading Strategies Include Fibonacci Numbers

As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an email. You just may see your question answered in a future ETF Talk.

share on:

Like This Article?
Now Get Jim's FREE Special Report:
The Top 11 Dividend ETFs to
Buy Right Now

Get up to 5X the yields of traditional income plays.

Get Access to the Report, 100% FREE


img
share on:

PREMIUM SERVICES FOR INVESTORS

Dr. Mark Skousen

Named one of the "Top 20 Living Economists," Dr. Skousen is a professional economist, investment expert, university professor, and author of more than 25 books.

Product Details

  • Forecasts & Strategies
  • Home Run Trader
  • Fast Money Alert
  • Five Star Trader
  • TNT Trader
LEARN MORE HERE

Bryan Perry

A former Wall Street financial advisor with three decades' experience, Bryan Perry focuses his efforts on high-yield income investing and quick-hitting options plays.

Product Details

  • Cash Machine
  • Premium Income PRO (exclusively for subscribers of Cash Machine)
  • Quick Income Trader
  • Breakout Options Alert
  • Hi-Tech Trader
LEARN MORE HERE

Jim Woods

Jim Woods has over 20 years of experience in the markets from working as a stockbroker,
financial journalist, and money manager. As well as a book author and regular contributor to
numerous investment websites, Jim is the editor of:

Product Details

  • Successful Investing
  • High Velocity Options
  • Intelligence Report
  • Bullseye Stock Trader
  • Eagle Eye Opener
LEARN MORE HERE

Bob Carlson

Bob Carlson provides independent, objective research covering all the financial issues of retirement and retirement planning. In addition, Bob serves as Chairman of the Board of Trustees of the Fairfax County (VA) Employees’ Retirement System, which has over $2.8 billion in assets.

Product Details

  • Retirement Watch
  • Retirement Watch Spotlight Series
  • Lifetime Retirement Protection Program
LEARN MORE HERE

Jon Johnson

Jon Johnson's philosophy in investing and trading is to take what the market gives you regardless if that is to the upside or downside. For the past 21 years, Jon has helped thousands of clients gain success in the financial markets through his newsletters and education services:

Product Details

  • Investment House Daily
  • Stock of the Week
  • Technical Traders Alert
  • Rapid Profits Stock Trader
LEARN MORE HERE

DividendInvestor.com

Used by financial advisors and individual investors all over the world, DividendInvestor.com is the premier provider and one-stop shop for dividend information and research.

Product Details

Popular tools include our proprietary Dividend Calendar, Dividend Calculator, Dividend Score Card, and many more.

  • Dividend Investor
LEARN MORE HERE

George Gilder

George Gilder is the most knowledgeable man in America when it comes to the future of technology and its impact on our lives.  He’s an established investor, bestselling author, and economist with an uncanny ability to foresee how new breakthroughs will play out, years in advance.

Product Details

  • Technology Report
  • Technology Report PRO
  • Moonshots
  • Private Reserve
  • Millionaire Circle
LEARN MORE HERE

DayTradeSPY

DayTradeSPY was founded by head trader Hugh Grossman, a retired internal auditor for a Fortune 500 company. After years of first-hand experience trying out one trading strategy after another, Hugh instead developed his own trading system centered around day trading SPY options. That’s it... Nothing else.

Product Details

  • Trading Room
  • Pick of the Day
  • Inner Circle
  • Online Workshops
LEARN MORE HERE