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  • Moat Investing

    Quality and Valuation a Dynamic Duo in Global Moats

    Van Eck Global
    November 30, 2017
     

    The performance of VanEck Vectors® Morningstar International Moat ETF (MOTI®) tells an impressive story about the importance of not only identifying quality companies with sustainable competitive advantages but also factoring in valuation to determine the right entry points. These are the basic tenets of Morningstar’s moat investing philosophy, which is based on the economic moat concept that can be traced back to Warren Buffet.

    Morningstar has a history of well-regarded U.S. equity research and has built a similar reputation in markets outside the United States. An international strategy based on the firm’s rigorous equity research process has performed well in recent years.

    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.

    While MOTI’s performance these past 12 months alone has been notable, its returns since inception have been equally impressive. As of September 30, 2017, MOTI has performed near the top of its Morningstar peer group – US Fund Foreign Large Value category. MOTI ranked in the 4th percentile (13th of 316 funds) for the last year and ranked in the 6th percentile (22nd of 324 funds) since its inception on July 13, 2015, based on total returns.

    Cumulative Return Since MOTI's Inception
    July 13, 2015 - September 30, 2017

    Cumulative Return Since MOTI's Inception Chart

    Source: The Morningstar. Click here to view performance current to the most recent month end.


    MOTI Expenses: Gross 1.62%; Net 0.56%. Expenses are capped contractually at 0.56% until February 1, 2018. Cap excludes certain expenses, such as interest.

    Performance data quoted represents past performance which is no guarantee of future results and which may be lower or higher than current performance. Performance current to the most recent month end available by calling 800.826.2333 or by visiting vaneck.com. Investment returns and ETF share values will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. ETF returns assume that dividends and capital gains distributions have been reinvested in the Fund at NAV.

    The category average is calculated using a weighted average of the NAV return of the share classes of the funds within the category and reflects the reinvestment of all dividends and fees and expenses applicable to the funds in the category, but does not reflect the payment of transaction costs that are associated with an investment in the funds. A category average’s performance is not illustrative of an investment in all of the funds in that category. Category averages are not securities in which investments can be made. Results reflect past performance and do not guarantee future results.