MOAT ETF Hit by Energy Holdings

BenWP

I've been a happy camper with MOAT, but it has suffered steep declines of late because of big weightings in energy stocks: Williams, Schlumberger, Spectra Energy, Core Labs, Exxon, Exelon, Nat'l Oilwell, and Oneok. Remember, there are only 20 stocks in the fund. I point this out because there may be MFO members who are looking for a way to play an (eventual) recovery in oil prices. The M* index methodology is responsible for the stock picks, so things will change next quarter. If energy companies still show up as undervalued, they'll be included. FWIW.

scott

I put a lot of focus on what I consider to be wide moat companies, but I think this index - and I haven't looked at it in detail - consistently tries to look for companies that are undervalued. Personally, I pick my spots and stick with them. This is an interesting ETF though and it's something that I've considered.

LLJB

Interestingly, if today was the end of the quarter and they were to pick the portfolio today you'd end up with most of the energy names you mentioned plus 4 healthcare investments (Baxter, Merck, Amgen and Actavis). The energy names aren't a big surprise although they have reduced a bunch of their fair value estimates and that would tend to reduce the number of energy companies that make the cut, but I'm surprised by the healthcare number. I've never invested in MOAT but have been watching it since its inception and I like the approach. It will be interesting to see how the performance is affected by the amount of time it takes energy stocks to regain what they've lost.