VanEck has launched the VanEck Morningstar ESG Moat ETF (CBOE: MOTE), the newest addition to the firm’s lineup of moat investing ETFs as well as to VanEck’s growing lineup of sustainability-focused investment solutions.
MOTE is designed to provide investors with exposure to attractively priced US companies that Morningstar believes possess long-term competitive advantages, or ‘moats’, that have been screened for ESG risks.
“Our flagship VanEck Morningstar Wide Moat ETF (MOAT) has been well-received by the investor and adviser marketplaces since its inception in 2012. In order to meet growing demand for more sophisticated ESG investing approaches, we’re very pleased to be introducing MOTE, a natural progression of both our moat and ESG-focused efforts,” says Brandon Rakszawski, Senior ETF Product Manager with VanEck. “ESG risks are, after all, business risks. Being able to focus on U.S. companies with both sizable moats and reduced ESG concerns relative to their peers makes MOTE a potentially powerful addition to a core equity portfolio.”
MOTE seeks to track the Morningstar US Sustainability Moat Focus Index, which targets a select group of wide moat companies that, according to Morningstar’s equity research team, are attractively priced. Morningstar’s extensive Sustainalytics ESG risk analysis is used to screen for companies that are better managing financially material ESG risks relative to peers as well as exclude companies involved in products widely viewed as controversial.
“We are looking forward to expanding on our longstanding, successful collaboration with VanEck to offer our unique index approaches to help benefit long-term investors,” says Ron Bundy, President of Morningstar Indexes. “The Morningstar US Sustainability Moat Focus Index helps investors tap into ESG opportunities in the market by using Morningstar’s equity research ratings in concert with ESG insights from Sustainalytics. It offers an added sustainability lens through our ESG Risk Rating on top of our unique Economic Moat index methodology that has demonstrated its value over the past 15 years.”
“We’re excited to continue working with Morningstar, which remains a leader in equity research and innovative ESG analytics,” says Rakszawski.
MOTE joins a suite of moat-style investing strategies from VanEck that also includes the USD6.7 billion (as of 9/30/2021) VanEck Morningstar Wide Moat ETF (MOAT), the international equity-focused VanEck Morningstar International Moat ETF (MOTI), and the VanEck Morningstar Global Wide Moat ETF (GOAT).