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

Designed to provide broad exposure to the Large Cap Blend segment of the US equity market, the VanEck Morningstar Wide Moat ETF (MOAT) is a passively managed exchange traded fund launched on 04/24/2012.

The fund is sponsored by Van Eck. It has amassed assets over $12.48 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

Large cap companies typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.

Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.

Costs

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%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.48%.

Sector Exposure and Top Holdings

While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Healthcare sector--about 24% of the portfolio. Information Technology and Industrials round out the top three.

Looking at individual holdings, Boeing Co/the (BA) accounts for about 2.79% of total assets, followed by Huntington Ingalls Industries Inc (HII) and Zimmer Biomet Holdings Inc (ZBH).

The top 10 holdings account for about 26.35% 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 -7.50% so far this year and it's up approximately 0.34% in the last one year (as of 05/07/2025). In the past 52-week period, it has traded between $76.53 and $98.73.

The ETF has a beta of 1.02 and standard deviation of 19.78% for the trailing three-year period, making it a medium risk choice in the space. With about 54 holdings, it effectively diversifies company-specific risk.

Alternatives

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 sufficient 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 SPDR S&P 500 ETF (SPY) and the Vanguard S&P 500 ETF (VOO) track a similar index. While SPDR S&P 500 ETF has $575.93 billion in assets, Vanguard S&P 500 ETF has $614.43 billion. SPY has an expense ratio of 0.09% and VOO charges 0.03%.

Bottom-Line

Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.

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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This article originally published on Zacks Investment Research (zacks.com).

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