Registered investment advisors know that durability and resiliency are desirable traits, particularly when constructing portfolios for the long term. In the world of equities, there are myriad ways of accessing those characteristics, but wide moat investing is one of the standouts.
As noted by VanEck, which is the issuer behind a suite of several dedicated well-known wide moat exchange traded funds, companies with the wide moat designation have at least two decades of competitive advantages relative to rivals. Alone, that’s impressive. Add in the fact that wide moat investing is very much the style embraced by Warren Buffett, and the case for this style only grows.
Advisors can learn more about the benefits of wide moat investing on VanEck’s upcoming webcast exploring the advantages of wide moat companies in turbulent market environments.
During the July 12 webinar, VanEck director of product management Brandon Rakszawki and Andrew Lane, Morningstar director of equity research — index strategies — will explore companies and sectors that could be durable in volatile markets ahead, the advantages of wide moat investing across multiple market capitalization segments, and other topics.
Wide Moat Advantages Available in Surprising Places
The VanEck Morningstar Wide Moat ETF (MOAT ), which follows the Morningstar Wide Moat Focus Index, is the original fund in the issuer’s wide moat suite, having debuted in April 2012. Today, MOAT is a $9.50 billion juggernaut with a lengthy track record of besting the broader market.
MOAT, which carries five-star Morningstar ratings for the trailing three- and five-year periods has spent the better part of a decade beating the S&P 500 — a relevant comparison because MOAT is a large-cap ETF.
Speaking of market cap segments, many investors, including advisors’ clients, that are familiar with wide moat investing view this is a large-cap-only phenomenon. That’s not the case, and that will be a point of emphasis on the upcoming webinar as Rakszawki and Lane will discuss the applications of the wide moat style with mid- and small-cap equities.
Those applications are playing out in real time thanks to the VanEck Morningstar SMID Moat ETF (SMOT ). MOAT’s smaller stock counterpart, SMOT, debuted last October and already has nearly $82 million in assets under management.
That’s a sign that SMOT is gaining traction with advisors. Equally as important is the point that SMOT is higher by 9% year-to-date — a performance that easily tops those turned in by broader mid- and small-cap equity benchmarks. Importantly, SMOT is delivering the goods with an emphasis on attractively valued firms and the ability to reduce some of the volatility often associated with smaller equities.
Advisors that would like to attend the July 12 wide moat webinar can register here.
For more news, information, and analysis, visit the Beyond Basic Beta Channel.
